A Carriage Made in Heaven – but can the Revived HS2 Stimulate the Pound?
12 February 2020

Tuesday's confirmation that HS2 high-speed rail is back on track had the top of the government's batting order united in praise for Boris Johnson's 'boost capacity, cut fares and journey times' statement to the House of Commons. The Pound was also bullish – like HS2 it headed northwards against all the major currencies for the third day running. All this, coupled with a December GDP growth and the possibility of a spending budget in March are bolstering Sterling.

Certainly perception plays a crucial role in this latest Johnson initiative. The prime minister is sending a message to the world that the UK is open for business and despite the flagship London to Birmingham flagship section of HS2 starting a year late, the mood is upbeat. And this financial confidence is reflected in yesterday's Pound-Euro (higher gains at 1.18) and Pound-Dollar rate of 1.293 is closing in on the benchmark 1.30.

So with spending on infrastructure, health and the environment in the pipeline, will prosperity replace a decade of austerity and protect the Pound as the inevitable media storm gathers during the EU trade negotiations?

Says Privalgo's Daniel Fozard: "Markets favor fiscal stimulation and with more government spending announcements to come we could be on track to see a strengthening of Sterling in the coming months."

Speak to a Privalgo representative today to get a better understanding of our 2020 predictions and advice on your FX transactions.

A Carriage Made in Heaven – but can the Revived HS2 Stimulate the Pound?
12 February 2020

Tuesday's confirmation that HS2 high-speed rail is back on track had the top of the government's batting order united in praise for Boris Johnson's 'boost capacity, cut fares and journey times' statement to the House of Commons. The Pound was also bullish – like HS2 it headed northwards against all the major currencies for the third day running. All this, coupled with a December GDP growth and the possibility of a spending budget in March are bolstering Sterling.

Certainly perception plays a crucial role in this latest Johnson initiative. The prime minister is sending a message to the world that the UK is open for business and despite the flagship London to Birmingham flagship section of HS2 starting a year late, the mood is upbeat. And this financial confidence is reflected in yesterday's Pound-Euro (higher gains at 1.18) and Pound-Dollar rate of 1.293 is closing in on the benchmark 1.30.

So with spending on infrastructure, health and the environment in the pipeline, will prosperity replace a decade of austerity and protect the Pound as the inevitable media storm gathers during the EU trade negotiations?

Says Privalgo's Daniel Fozard: "Markets favor fiscal stimulation and with more government spending announcements to come we could be on track to see a strengthening of Sterling in the coming months."

Speak to a Privalgo representative today to get a better understanding of our 2020 predictions and advice on your FX transactions.

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