Sterling reached a six month high against the euro yesterday and also rose against the dollar. This is due to the continued optimism for a Conservative majority, which is thought to end the Brexit impasse and therefore be positive for sterling. As we edge closer to the election, however, we could see volatility.
The Conservative Party made an offer of an electoral pact to the Brexit Party this week, which was turned down by party leader Nigel Farage. The pact would have seen the Brexit Party targeting only 40 key seats held by the Labour Party, and the Tories pledged to stand ‘paper’ candidates in these constituencies. However, the deal was turned down as Farage wanted the Conservative candidates to withdraw completely.
Retail sales data came in yesterday, showing a decrease of 0.1% month-on-month and missing expectations of a 0.2% gain. The year-on-year figure was also disappointing, rising 3.1% and missing expectations of 3.7%.
