Sterling has begun the week on the front foot with the pound rising against all of its major peers following some hawkish comments over the weekend from BoE member Ramsden and an apparent softening in Labour’s Brexit stance was revealed during a speech from Jeremy Corbyn. Despite the currency appreciation stocks are also moving higher, with the FTSE 100 gaining more than 20 points to trade not far from last week’s highs.
BoE policy maker hints at further hikes
One of the main reasons behind the move higher seen in the pound today is comments made from Dave Ramsden in the Sunday Times, in which the voting member of the MPC stated that he now sees a stronger case for raising rate sooner than previously thought. Mr. Ramsden was one of only two members who voted against raising rates for the first time in a decade back in November, and this apparent hawkish shift in his views can be seen to suggest that there will be little opposition to further rate hikes going forward.
Corbyn shifts customs union stance
A speech from Jeremy Corbyn in Coventry this morning has seen the Labour leader adopt a somewhat softer stance on his Brexit position, insisting that the party would seek to remain in a customs union and a single market with the EU. This position is at odds with the Tories stance, with May ruling out any form of customs union with the EU post-Brexit, saying that it would curtail Britain’s ability to broker new trade deals. Corbyn has been a long-time eurosceptic and today’s announcement raises the possibility of a rebellion by pro-Europeans in May’s Conservative party and could derail her strategy. The move from Corbyn appears to be strategic in nature and is likely aimed at ramping up the pressure on the PM, increasing the chances of another election with polls between the two parties currently neck-and-neck.