Following the on-going results of the UK General Election, the British Pound fell sharply last night from levels as high as $1.29 on Thursday, to a month low of $1.26 on Friday morning. The Euro also strengthened against the pound, with EUR/GBP trading up 1.48% at 0.87. The exchange rate remains volatile as political uncertainty continues.
Industry leaders from deVere, FEXCO and Berry FX share their comments on the latest results from the UK election.
Richard Berry, Founder of the currency specialists, Berry FX, says:
“The Pound dived sharply overnight when the exit polls came in and has been stumbling through a wasteland ever since. What should have been a coronation for the prime minister, and a sustained boost for the Pound, has turned into a political and economic Mayday.
“The markets opened on Friday exactly where they didn’t want to be — with a huge cloud of doubt hanging over both Britain’s political future and the course of Brexit.
“As perverse as it seems, political chaos could ultimately translate into Sterling strength.”
Nigel Green, Founder and CEO of deVere Group says:
“With Theresa May’s job now surely on the line, just as the UK is set to begin Brexit negotiations, and a clear shift in voting dynamics across Britain, there is yet another enormous storm cloud of uncertainty about who will lead talks and how they will do so.
“Indeed, we’re entering into a perfect storm of chaos and the uncertainty is set to unleash mayhem across global financial markets, at least in the short term, as they react to the growing question marks hanging over the British parliamentary landscape.
“We can expect the pound to fall considerably, gilt prices to rise and UK-orientated stocks to come under further pressure as the UK tries to get a handle on what is happening before it officially starts the Brexit negotiations.”
David Lamb, Head of Dealing at FEXCO Corporate Payments comments:
“The Pound is paying the price for Theresa May’s failed gamble – and after a 2% fall overnight it remains deeply vulnerable. The Prime Minister had hoped to begin Britain’s Brexit negotiations this month with a thumping mandate and a spring in her step.
“In short, [this is] everything the markets didn’t want from Britain’s Brexit negotiators.”
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