Global Reach is becoming Corpay Cross Border, part of FLEETCOR, to broaden our client offering. Please contact our team or visit to find out more.

Brexit to dominate the UK agenda, but global economic worries build 3

Today's news headlines:​​​​​

  • 'Theresa May survives but struggles to win over Tory Brexit rebels’. The Prime Minister managed to avert a leadership challenge over the weekend but faces a tough week ahead. Today, MPs will decide whether they take control of the parliamentary agenda in a bid to resolve the Brexit deadlock. (Financial Times)
  • 'Yen gains as global economic worries drive risk aversion’. Weaker-than-expected manufacturing data from the US and Europe at the end of last week is driving a flight to safety. Although the US Dollar can often benefit in such situations, an inversion of the yield curve for US treasuries suggests the country could be edging towards recession. (Reuters)


Theresa May is coming under ever-increasing pressure from cabinet ministers, politicians, and the wider population to organise Brexit. Following yesterday’s failure to secure a deal with pro-Brexit MPs, a cabinet meeting will take place this morning, and the Prime Minister is expected to come under pressure to resign. However, questions remain over who would make for an appropriate replacement without triggering a general election.

The situation is further compounded by a vote taking place in Westminster where MPs could take control of the agenda, forcing a new Brexit vote as soon as Wednesday. This could force the government to decide between a deal that splits the Conservative party or fails again in parliament. A softer version of Brexit remains a possibility, and this is something which could be positive for the Pound. However, there’s also the chance of a no-deal outcome and the risk of a general election, which could leave Sterling facing heavy selling pressure. Volatility is likely to remain for a while yet.

Global economy

Downgraded growth projections from the Federal Reserve combined with poor Purchasing Managers’ Index (PMI) data released at the end of last week presented more concern over the global economic outlook. These events triggered a yield-curve inversion in the US, where the return on ten-year US government debt fell below that of shorter-dated bonds. This is often seen as a precursor of recession in the world’s largest economy. Because of this, some investors will be hunting out safe-haven currencies, such as the Japanese Yen, Swiss Franc, and to an extent, the US Dollar. Therefore, the Pound and Euro could be left under pressure as a result.


Renewed Brexit uncertainty is driving the Pound lower against the US Dollar in early trade. Political risk and concerns over Theresa May’s future will likely dominate in the short-term.


Disappointing PMI data from across the Eurozone on Friday saw the Euro lose a cent against the US Dollar which pushed the pair to ten-day lows.


A combination of Brexit optimism and weak Eurozone economic data served to drive the Pound almost two cents higher against the Euro on Friday. However, renewed political uncertainty is undermining gains as the new week gets underway.