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Brexit currency fallout: Exchange Rate Tracker
Use our interactive currency exchange rate chart to track the impact that the latest and biggest Brexit events have had on the pound, following the EU Referendum Act 2015.
On 23 June, 2016, the British people voted to leave the EU, triggering the end of Britain’s 43-year membership. Whilst the long-term impact of Brexit is still uncertain, what is clear is that the Brexit campaign and the outcome of the referendum had and are continuing to have a dramatic impact on stock markets and on the strength of the pound – sterling fell by 19% post the referendum.
Use this page to find out how the value of the pound has changed since Brexit, what events might have caused these changes and to learn more on who are the winners and losers of the depreciated pound.
Our interactive chart below shows the correlation between key Brexit events and their impact on the pound.
What Brexit events have had the biggest impact on the pound?
Brexit has caused significant changes to the pound sterling, not only from key events but from speculation within financial markets. However, these events, in particular, have had a major impact on the pound.
- Referendum result.Following the vote to leave the EU, the pound fell sharply. In the weeks following the referendum the pound fell by 10.4% against the Euro from €1.3017 on 23 June to €1.1663 on 6 July 2016.
- Article 50 Legal challenge. In October 2016 negotiations took place to determine whether Theresa May could trigger Article 50 without parliamentary approval. It was during this legal battle that the pound fell by 4.6% from €1.1579 on 30 September 2016 to €1.1044 on 11 October 2016. The High Court ruled that the government must have parliamentary approval i.e. a law would need to be passed through the House of Commons and the House of Lords in order to authorise Article 50.
- Single market speculation. The pound fell once again on the 16 January 2017 due to speculation surrounding Theresa May’s hardline approach to Brexit and the expectation that she would announce that Britain will be leaving the EU single market. The pound fell by 3.45% following these reports from €1.1767 Euros on 3 January 2017 to €1.1361 on 16 January 2017.
- Article 50 triggered. Theresa May triggered Article 50 on 29 March 2017. This kick-started the formal process of Britain’s exit from the EU, and saw the pound drop by 0.65% from €1.1612 on 23 March 2017 to €1.1537 on 29 March 2017.
- General election results. The sterling suffered its highest fall of 2017 following the surprise election result as Theresa May lost her majority government, sparking more political uncertainty in Britain. The pound fell to a seven-month low of €1.1287.
What key Brexit events could affect the pound in the future?
The value of the pound is set to continue to rise and fall as Brexit negotiations proceed forward throughout 2019 and beyond. All events that lead to increased uncertainty, changes to investor confidence and financial speculation will have some impact on the value of the pound. For example, any statements made by EU or British officials on the speed and success of progress are likely to cause fluctuations in the currency.
Major forthcoming Brexit events with the potential to have an impact on pound include:
- Negotiations. As the results of each stage of the negotiations are revealed and the future of Britain’s political relationship with Europe is shaped, the pound’s value will fluctuate.
- Deadline day. Mr Barnier (the European Chief Negotiator for Brexit) originally stated that he wanted all talks to be completed by October 2018 to allow ratification of the agreement. This left the UK less than 18 months to complete their negotiations. However, the negotiations are still ongoing, with 31st October as the new deadline.
- Exit Day. Originally, EU treaties should have ceased to apply to the UK, two years after Article 50 was triggered, in March 2019 (unless all 28 EU members agree to extend it or the UK decides to halt the process). However, it was agreed that the exit day will be extended to 31st October 2019.
- Transition period. Formal negotiations on the transition period began at the end of January 2018. Currently, the EU said that the transition should happen under existing rules and regulations, ending on the 31 December 2020. However, UK businesses have argued this will not leave them enough time to prepare for a post-Brexit economy, whilst Brexit supporters suggest the period is too extensive and will force the UK to follow EU rules without having any say on them.
- No deal. With the progress of negotiations very slow, there are still questions as to whether an agreement will ever be made. Unravelling 43 years of treaties and agreements that cover thousands of subjects was never going to be a simple task.
- Article 49. The European Commission has said that the UK can choose to reapply to join the EU using Article 49. A decision that would have a huge impact on the pound.
Planning to travel?
If you’re off on a business trip or planning a holiday abroad this year, then there are a few things you can do to help make up for the falling value of the pound.
Prepare: Some travel money providers require you to pass an identification process before you are able to exchange any funds and this authorisation process can take a number of days to complete. So in order to be able to exchange your travel money quickly when the exchange rate is strengthening in your favour, you can prepare by registering with a provider today.
Prepaid travel cards. Prepaid travel cards allow you to pre-load your money and lock in the exchange rate, rather than using the live rate as debit and credit cards will. Take a look at the strength of the pound – If it is looking favourable or predicted to be worse when you’re away, pre-load your cash and lock the exchange rate to give yourself more bang for your buck.
For more help on getting your travel money options right, check out our travel money comparison page or search our site for one of our country-specific travel money guides.
Sending money overseas?
If you or your business needs to send money overseas there are a few methods you can use in order to protect your money against currency shifts. Many international money transfer providers offer a variety of services which can allow you to transfer your funds when the currency is at your advantage, these include:
Spot contracts. These are ideal for one-off, fast, overseas payments, and allow you to agree on an exchange rate with your provider based on the market rate.
Forward contracts. If you like the look of the exchange rate available at the moment but you don’t need to send your money just yet, a forward contract allows you to lock in today’s rate for a transfer at a later date.
Limit orders.A limit order allows you to send currency overseas at a guaranteed exchange rate. If you have a target exchange rate in mind for your transfer, you can set a limit order to automatically purchase the currency should this level become available.
Regular transfers. If you need to make regular overseas payments, some money transfer providers allow you to set up an automatic recurring payment plan to save you time and hassle. Whilst some variation in the exchange rate may occur, this option would provide you with an average exchange rate over time.
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