Blog


Pound Could Drop by 2% on Election Results

Sterling would receive a post-election bounce of around 3% if British voters give the ruling Conservative Party a majority in parliament on Dec. 12 but will fall 2% if the opposition Labour Party wins a majority, a new poll found.

The pound has gyrated wildly since Britain decided in a June 2016 referendum to leave the European Union, see-sawing on any news about how the two sides would part ways after more than four decades together.

But the December election could result in another hung parliament and threaten to drag the Brexit debate past the latest deadline of Jan. 31.

Johnson is currently ahead in opinion polls.

The Labour Party plans to renegotiate Brexit and put the revised deal to a new referendum, something which could take months and lead to increased market uncertainty.

Britain’s pound hovered near a one-week low versus the dollar this morning as the market temporarily shifted its focus from next month’s parliamentary election to a Bank of England policy meeting.

With a snap election due on Dec. 12 and a new Brexit deadline set for Jan. 31, the BoE is expected to keep its key policy rate unchanged at 0.75% and not give an explicit steer on where interest rates are headed.

Increasingly economists believe the BoE will cut interest rates at some point next year given a slowing economy and Brexit uncertainty. Financial markets are pricing in a roughly 55% chance of a 0.25 percentage point cut in 2020.

Leave a Reply

Your email address will not be published. Required fields are marked *

What's Going On?

Currencies 4 You Ltd is a company registered in England and Wales (registered no. 06866898). Registered office: Regus House Victory Way Admirals Park, Crossway, Dartford, Kent, DA2 6QD. Currencies 4 You Ltd Payment and Foreign Currency Exchange Services are provided by Currency Cloud Limited, Equals Connect Limited and Ebury Partners UK Limited. Currency Cloud Limited. Registered in England No. 06323311. Registered Office: Stewardship Building 1st Floor, 12 Steward Street London E1 6FQ. The Currency Cloud Limited is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011 for the issuing of electronic money. FCA registration number: 900199. Payment Services are provided by Equals Connect Limited, registered in England and Wales (registered no. 07131446). Registered Office: Vintners’ Place, 68 Upper Thames St, London, EC4V 3BJ. Equals Connect Limited are authorised by the Financial Conduct Authority to provide payment services (FRN: 671508). Currencies 4 You Ltd is partnered with Ebury Partners UK Limited as its Programme Mananger. Ebury Partners UK Limited are authorised and regulated by the Financial Conduct Authority as an Electronic Money Institution. (Reference Number 900797). Ebury Partners UK Ltd is registered with the information commissioners office with registration number: ZA345828. | Terms and Conditions | Privacy Statement | Careers