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An Update on Brexit
The dust has finally settled after the UK Snap elections and now the United Kingdom can turn their heads to discussions with the European Union about how and on what terms they will leave the Union. The Brexit negotiations officially began on 19th June in Brussels, the opening day mainly consisted of the timing and structure of the negotiations with actual trade talks expected to begin on 24th July.
One of the main issues that both parties want to get resolved as soon as possible is the status of EU nationals in the UK and the UK citizens living within the European Union. On 26th June, Theresa May set out her plans for the EU citizens living in the United Kingdom, advising she wants the EU nationals to stay in the UK. Mrs May outlined that all EU citizens living in the UK before it leaves the EU will be able to apply for a ‘settled status’ but only if the UK citizens will get the same deal within the EU and with the actual trade talks beginning towards the end of July, we should soon see what the details of the Brexit divorce will look like.
When the UK Election results came in, we saw the Pound weakening against the US Dollar as it emerged that Theresa May did not win the majority which meant more uncertainty for Britain going into the Brexit negotiations. Since then, the Pound has strengthened against the US Dollar, but with the beginning of Brexit talks we can expect some movements in the financial markets in the coming months.
Source: GO Markets MT4
We saw the FTSE100 reach record highs at the beginning of June, however since then there has been slight decline in the Index.
Source: GO Markets MT4
A lot of people expected the UK economy to slow down drastically after the Brexit vote but instead we saw a steady growth in the months after the result was announced. The latest economic figures show that UK economy was the worst performer in European Union with economic growth of just 0.2% in the first three months of 2017 with Romania, Latvia and Slovenia with the strongest expansion with 1.7%, 1.6% and 1.5% respectively. However, in terms of year-on-year the UK is still closer to the EU performance and ahead of 19-nation eurozone (EU countries with Euro as their currency).
Source: Office for National Statistics
June 2017 saw the start of what looks to be a two year journey which culminates in The United Kingdom leaving the EU.
By: Klavs Valters
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