As crazy weeks go the last one is surely up there. Everything looked to be going OK for Theresa May, as she managed to convince her cabinet to support her Brexit draft agreement. However, the morning after, Dominic Raab resigned as Brexit minister, saying he couldn’t support the proposals and Esther McVey followed suit shortly after. The pound suffered some significant falls, slipping to around $1.27 against the dollar and falling by around 1.8% against the euro.
Then Jacob Rees-Mogg called for a no-confidence vote in Theresa May and some fellow Conservative MPs also sent letters to Sir Graham Brady, chair of the 1922 Committee. We looked to be set up for a fascinating end to the week and, while plenty did happen, there weren’t quite the fireworks we might have reasonably expected. Michael Gove turned down the job of Brexit secretary, while he, along with several other Brexit-backing cabinet ministers refused to resign, saying that they would instead stay and encourage May to renegotiate the Brexit proposals.
Late in the afternoon we learned Stephen Barclay was appointed Brexit Secretary. He voted to leave the European Union. The pound actually had a pretty decent day against the dollar, although it didn’t retrace Thursday’s losses. It was relatively flat against the euro throughout the day as investors brace themselves for the next few days and weeks, when we can expect plenty more drama.
In addition to more Brexit-related news, this week we will see a raft of purchasing managers’ indices from Germany, the US and eurozone, as well as durable goods orders from America. In the UK, we will see the public sector net borrowing figures for October, but other than that it is relatively quiet. Having said that, the recent volatility in the currency markets has necessitated a bit of a breather. Still, it wouldn’t be a surprise to see some further shocks relating to the government’s approach to Brexit over the next few days.
If you’re purchasing overseas in the coming months, do not leave your budget exposed to such volatility. Call your Personal Trader on 020 7898 0541 to enquire about a forward contract, whereby they will lock in a single exchange rate for up to a year. And, if you’re considering purchasing a home or moving overseas soon, do read up on how Brexit will impact this in the handy guide produced by our partners, Property Guides.
