Pound hits six-month high against euro, but trade worries hit stocks – business live

Rolling coverage of the latest economics and financial news

12.29pm GMT

Despite its recent recovery, the pound is still around 10% below its value in June 2016, before the EU referendum.

Ian Strafford-Taylor, CEO of international money specialist, Equals, says this has a significant impact at the foreign exchange desk:

“Despite the TV debates and mud slinging between parties, the pound is actually in a much stronger position against the euro than it was at the start of the year – currently 7% higher with a rate of 1.174. It’s not quite at the height of the one-year peak we saw in May this year (1.175) but it’s not far off and is standing at a six-month high.”

“A lot can happen in the two weeks we still have until the election so we shouldn’t expect to see the pound stay at these rates. The build-up to past elections have seen the pound go on a rollercoaster journey and a new Prime Minister typically brings about a significant change in the strength of the pound, so we should brace ourselves for more turbulence.”

12.20pm GMT

With December looming, many investors big and small will be wondering where to put their money in 2020.

A lot depends on the general election, of course. But Dean Turner, Economist at UBS Global Wealth Management, reckons UK stocks might be underwhelming whatever happens on 12 December.

“Despite a relatively good year for equity returns in 2019, 2020 looks set to be a flat year for UK earnings.

“Investors who’ve pinned their hopes on the 12 December poll offering a clear direction of travel will likely be disappointed. In the event of a Conservative majority, Brexit may be ‘completed’, however gains will be capped as the next phase of negotiations ensues. Should the election result in a hung parliament, we expect a further extension to Article 50.”

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