Following yesterday’s chronic bout of Sterling weakness, the Pound has opened weaker for the second consecutive day this week. Yesterday evening saw the heads of state of Commonwealth nations gather together at an event in London hosted by the UK Prime Minster Theresa May. As the market opens this morning, investors appear uncertain whether the UK made headway in under the table trade negotiations last night. According to the draft transitional agreement, the UK may negotiate its own trade negotiations, although not implement them, during its transitional phase. With Brexit day less than a year away, any informal news about last night’s meeting could prove positive for the Pound.
Globally, two interesting notes appear from emerging markets: South Africa and Turkey. In South Africa yesterday morning, March’s reading of Consumer Price inflation was published. The publication showed that annualised consumer price inflation for March was just 3.8%, exaggerating its decline further. Following an interest rate cut by 25 basis points at the central bank’s last meeting, low CPI inflation is not what was prescribed for South Africa’s economy. Whilst the Rand held relatively strong during yesterday’s trading session, the statistics do create cause for concern about the future path of monetary policy.
In Turkey yesterday, the declaration by President Erdogan of a snap election rallied the Lira. The move by Erdogan represented an opportunistic attempt to consolidate power while domestic growth and political satisfaction is acceptable. The Lira gained 2.5% against the Dollar, rallying to a rate of just shy of 4 Lira to the Dollar.
Discussion and Analysis by Charles Porter
Click Here to Subscribe to the SGM-FX Daily Newsletter
Related Insights
Daily Brief – Defiance
Charles Porter
Tue 12 May 2026
Defiance Yesterday’s market was defying one of two things: logic or gravity. Come to think of it, perhaps both. Take cable, GBPUSD, yesterday. The key events beyond minor data releases centred around any chatter from either side of the Iranian conflict and Starmer singing for his supper. Sing he did and tweet the President did, […]
Daily Brief – Short-lived relief rally
Charles Porter
Tue 19 May 2026
Short-lived relief rally A tantrum in the bond market has continued to erode away at risk conditions in recent sessions. In the UK, the sell-off in gilts and corporate bonds has been particularly acute thanks to heightened political instability, the origins of which we have covered thoroughly in recent briefings. Yesterday, headlines delivered enough optimism […]
Daily Brief – Room to manoeuvre
Charles Porter
Tue 26 May 2026
Room to manoeuvre Kevin Warsh was sworn into office at the White House on Friday. Despite limited market movement on Friday, many prices gapped significantly come the open yesterday. Whilst the UK and US observed a bank holiday yesterday, many indices and currencies were on the move. The theme across the market was risk on […]
