The Pound has had its worst day in two months yesterday, with exchange rates against most of its major currencies now reaching a two month low, and Swiss Franc exchange rates reaching down to the much dearer end of the 1.20’s once more. Theresa May’s comments yesterday were inflammatory but still fairly vague. She gave little away but markets were all collectively worried enough about the potential reaction that this caused a run against the Pound. She made a few comments that hinted we could not pick and choose individual aspects of the Brexit that suited us, and, which was suggestive that we were heading towards a harder Brexit than some of their recent rhetoric has suggested. David Davis, the Brexit Secretary, had previously said that it was likely the UK would continue to pay for preferential access to the single market only a month ago in a deposition to Parliament. It seems markets are given two sides to the same story. Davis is showing the aims for Parliament, and May is posturing as part of the pre-negotiation phase. However, similar posturing comments from the likes of French President Francois Hollande and the German Chancellor Angela Merkel in quick succession caused a complete flash crash on the Pound. GBP/CHF fell by more than 5 cents on the day.
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Joshua Privett considers the following as important: Featured, newslettersent, Swiss Franc Forecast
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The Pound has had its worst day in two months yesterday, with exchange rates against most of its major currencies now reaching a two month low, and Swiss Franc exchange rates reaching down to the much dearer end of the 1.20’s once more. Theresa May’s comments yesterday were inflammatory but still fairly vague. She gave little away but markets were all collectively worried enough about the potential reaction that this caused a run against the Pound. She made a few comments that hinted we could not pick and choose individual aspects of the Brexit that suited us, and, which was suggestive that we were heading towards a harder Brexit than some of their recent rhetoric has suggested. David Davis, the Brexit Secretary, had previously said that it was likely the UK would continue to pay for preferential access to the single market only a month ago in a deposition to Parliament. It seems markets are given two sides to the same story. Davis is showing the aims for Parliament, and May is posturing as part of the pre-negotiation phase. However, similar posturing comments from the likes of French President Francois Hollande and the German Chancellor Angela Merkel in quick succession caused a complete flash crash on the Pound. GBP/CHF fell by more than 5 cents on the day. |
GBP/CHF - British Pound Swiss Franc, January 10(see more posts on GBP/CHF, ) - Click to enlarge |
The dual hit for CHF buyers is that in times of uncertainty the Swiss Franc gains even further value as a safe haven currency. So the sudden loss in value for the Pound was coupled with a hefty gain on CHF value, meaning that GBP/CHF was one of the heaviest losers on the day yesterday.
Markets are still reeling from the news, with GBP/CHF beginning the day 0.7 cents down on the day.
There is still the potential for improvements this week, but in a panicking market, often the sensible option is simply to draw a line under any planned purchase and accept the current levels of exchange. This hypersensitivity could lead to further drops.
I strongly recommend as a minimum that if you have a planned CHF purchase to contact me on [email protected] to discuss the options open to you and a strategy for your transfer.
I have never had an issue beating the rates of exchange on offer elsewhere, so a brief conversation could save you thousands on a prospective transfer.
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