Pound Sterling Exchange Rates Jump on Soft Brexit Possibilities

Getty Images Pound to euro exchange rate Travellers are facing a tough time financially if visiting Europe

Getty Images Pound to euro exchange rate Travellers are facing a tough time financially if visiting Europe

Sterling has jumped to its highest level against the United States dollar since the Brexit vote. Today Bloomberg reported that Spanish and Dutch finance ministers are going to work closely in an attempt to obtain a Brexit deal that allows the United Kingdom to remain as close to the European Union as possible.

The remaining European Union member states continued to stand united against Britain, with French president Emmanuel Macron warning countries to remain disciplined in order to protect all of their interests.

The pound is now at around $1.3380 against the U.S. dollar, down 0.24 per cent from this morning's starting levels and the first time the pairing has dropped below $1.35 in two weeks.

Analysts said the rise in pound had been driven by the weakness in the dollar.

However, while the two finance heads reiterated the importance of British ties for both countries, and agreed to look out for each other's shared interests they also offered their full support to Michel Barnier with negotiations, a Spanish economy ministry official said.

Meanwhile a lull in domestic data may leave the pound a little directionless for the remainder of this week, with GBP investors likely to turn their attention to next week's inflation figures.

"Just because two of the 27 members say this, it doesn't mean a softer Brexit will happen".

The pound was 0.2% higher against the euro at €1.12810 after the single currency hit a three-year high against the dollar following hopes that chancellor Angela Merkel would be able to form.

The study, which was commissioned by London Mayor Sadiq Khan, suggests that should Britain leave the European Union without access to the single market it would lead to a huge fall in jobs and up to £50bn less in investment by 2030.

"Sterling is benefiting from the dollar weakness and the growing euro strength rather any pound-specific factors, which if anything have been underwhelming this week", said Alvin Tan at Societe Generale.

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