Pound jumps on Merkel positivity over finding backstop solution

Aug 22, 2019

The pound has just bounced higher following some more positive comments from Germany’s Merkel this afternoon. She suggested that solutions for Brexit and the Irish backstop could be found by the 31st October deadline.

This follows on from an upbeat meeting between her and Boris Johnson yesterday afternoon where she tasked Boris to find an alternative solution to the backstop within the next 30-days. These more conciliatory tones from Europe’s biggest economy have so far been taken well by the market. As a result, the Pound’s just spiked up over 1-cent against both the Euro and USD; with the pound trading at a 3-week high.

Earlier comments from France’s president (Mr Macron) were firmer ahead of his meeting with Boris today. He re-iterated the importance of keeping the Irish backstop and the importance of protecting the European project. It will be interesting to see if we get any further developments following their meeting and after this weekend’s G7 Summit.