GBP/SEK has been moving sideways since late Friday.
Currently, one British pound buys 12.6686 Swedish Krona, down 0.04% as of 6:05 AM UTC. While the pair has stagnated since the end of last week, the larger timeframes prove its bullishness. The rate is very close to update the highest level since December 2015.
The British pound has been under pressure amid post-Brexit worries, as the UK and the European Union are set to launch the trade talks next week.
BRC: UK consumer might see higher prices if the government won’t reach agreements with the bloc
The British Retail Consortium (BRC) said earlier today that UK consumers would experience higher prices and reduced supply of goods if the government led by Prime Minister Boris Johnson doesn’t reach consensus on pragmatic solutions with the bloc regarding essential issues, including regulatory checks at ports.
While Britain is seeking to reach a Canada-style agreement that would allow it to import and export goods seamlessly, the government stressed last week that border controls would be required to make sure the borders are kept secure and the right customs and excise duties are collected.
The BRC warned that companies might be required to deal with tons of paperwork at border crossings if the two sides don’t reach practical agreements. The documents will revolve around the VAT sales tax, freight documents, export health certificates, health and veterinary documents, exit and entry summary declarations, and safety and security authorizations. BRC CEO Helen Dickinson explained:
“The issue is simple – higher tariffs and extensive checks will harm consumers, retailers, and the UK economy. The government must set about to negotiate a zero tariff agreement that minimises checks and red tape otherwise it will be consumers who suffer as a result.”
This is especially relevant when about 80% of all the food that British retailers import comes from the European Union.
Elsewhere, French foreign minister Jean-Yves Le Drian warned the UK to expect a fierce battle with the European bloc during the trade negotiations. What’s more worrying for investors, he said that the UK would find it difficult to achieve its goal of agreeing on the trade deal by the end of the year.
