GBP/EUR is moving sideways on the last day of the year. Currently, one British pound buys 1.1704 euro, down 0.02% as of 6:00 AM UTC.
On New Year’s Eve, Germany and Italian markets are closed while the UK and French markets will close early. Thus, the trading volume is maintaining at a minimum level. Investors are doing the retrospection and give their predictions for 2020.
The sterling has been moving in an upward trend since December 23, as the fears of a no-deal Brexit have eased a bit. Meanwhile, the British currency reacted positively on several economic indicators.
Yesterday, the UK government announced that the national minimum wage would increase by over 6% in 2020, to 8.74 pounds an hour. Thus, the UK is close to meeting its target for the minimum wage to achieve 60% of median earnings by next year.
Prime Minister Boris Johnson, who won a historic victory in the election, said:
“Hard work should always pay, but for too long, people haven’t seen the pay rises they deserve.”
The rise to 8.74 is expected to take effect on April 1. The government stated that the salary pay for younger workers would also rise between 4.6% and 6.5%.
The British Chambers of Commerce stated: “Raising wage floors by more than double the rate of inflation will pile further pressure on cash flow and eat into training and investment budgets. For this policy to be sustainable, government must offset these costs by reducing others – and impose a moratorium on any further upfront costs for business.”
During the election campaign carried out earlier this month, Johnson promised to boost the minimum wage to 10.50 pounds an hour by 2024.
The concept of a minimum wage was introduced in the UK under PM Tony Blair 20 years ago. It has increased at a modest pace after the annual advice of a committee comprised of business representatives, academics, and trade unionists.
Britain is set to leave the European bloc within a month, after which it should reach a trade agreement by December next year.