EUR/GBP Fundamental Forecast – August 16, 2016

The EUR/GBP added 7 points to trade at 0.8651 as the euro continued to outpace the pound as both currencies are waiting on Wednesday’s big data day from both economies. Many economists believe Britain is heading for a recession followed by years of slow growth because of uncertainty about its future trading relationship with the EU.

Earlier this month, the Bank of England cut interest rates and took other measures to soften the impact of Brexit, which it believes will push up the unemployment rate sharply.

Britain’s exit from the European Union could be delayed until at least late 2019 because the government was too “chaotic” to start the two-year process early next year, the Sunday Times reported, citing sources it said were briefed by ministers.

Britain voted to leave the EU on June 23, but views differ over when it should invoke “Article 50”, which sets the clock ticking on a two-year deadline to leave the bloc, with some senior politicians calling for a quick departure.

Prime Minister Theresa May, who campaigned for Britain to remain in the EU and leads a cabinet of ministers from either side of the debate, has said she will not trigger Brexit talks this year as Britain needs time to prepare.

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Tuesday, August 16, 2016

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