London RationalFX

RationalFX : Traders await Sunak’s summer statement

RationalFX : Sterling had a mixed start to the week yesterday, as traders continue to look ahead to this month’s Brexit negotiations and to expected government support measures …

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There was also data released showing that British construction companies returned to growth in June for the first time since the coronavirus hit.

Chancellor Rishi Sunak makes his ‘Summer Statement’ on Wednesday, and the market has seen a footing for the pound as further stimulus and support measures are expected. The expected focus will be on helping businesses return to normality, with rumoured tax cuts being the main source of support. There is a possibility of a short term VAT cut and certain sectors could be the target of loans and grants to aid recovery.

The stalling housing market may also receive a boost with a temporary freezing on the stamp duty tax, with the aim of bringing perspective buyers back to the market and to fight off a potential collapse.

We are expecting more clarity on Brexit as July progresses, with access to financial markets coming into focus due to the importance of finding a common ground. Banking Lobby AFME stated yesterday that the coronavirus would make the further disruption of a no-deal even harder to cope with.

Key announcements


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