Daily Currency Reports

Today's exchange rate news

US bank holiday sees traders eye tomorrow's Parliament session

2nd September 2019
  • Traders awaiting vote of no confidence in UK government
  • Critical week for Brexit
  • No end in sight for US/China trade war

Sterling continued to trade at near multiyear lows on Friday versus both the Euro and US Dollar as markets prepare for Parliament to resume tomorrow amidst growing tensions between opposition parties in relation to Brexit. Ministers will have just a week to debate before Parliament is shut down for nearly a month, although reports have suggested there are a number of legal challenges brewing in an attempt to stop the ‘proroguing.’ In addition, Jeremy Corbyn has confirmed on numerous occasions he will hold a vote of no confidence in the government, although opposition parties strongly oppose Corbyn taking charge of a caretaker government. Analysts have suggested this coming week is likely to be decisive in the outcome of Brexit, with Sterling likely to bear the brunt of any further uncertainty or negativity, with traders citing a potential decline of 10% in the event of a ‘no deal.’

Across the pond, despite optimism that President Trump would delay additional tariffs on Chinese goods, a further 15% were added yesterday including footwear, smart watches and flat screen televisions. These come after somewhat of a hiatus in tensions where many were of the belief a resolution could be found to avoid any additional tariffs between the world's two largest economies. The US Dollar has continued to trade sporadically with traders constantly playing catch up with comments from both the US and China.

With a US bank holiday today, markets are expected to be relatively quiet although things will hot up tomorrow when the UK parliament resume talks.

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