Election Effect On Gbp

T heresa may s announcement of a snap general election pushed the pound up by around 1pc last week against the dollar and the euro breaking sterling out of the low band in which it had been.

Election effect on gbp. Gbp usd struggles around 1 32 on no deal brexit fears gbp usd is struggling to hold onto 1 32 after hitting a low of 1 3134 as brexit talks seem to be on the verge of collapse. The usd could buy 3 4 more euros eur and british pounds gbp on non election years than election years. Elections and their potential impact on government and fiscal policy can create uncertainty a phenomenon most investors detest.

The pound is now worth almost. The principal driver of gbp usd short term will be the results of today s us elections but traders also need to keep one eye on the post brexit trade talks and this thursday s bank of england. The value of the pound has surged to its highest level since may 2018 following the results of the uk general election but how does the exchange rate affect you.

Brexit talks have yet to yield an agreement. The pound has strengthened about 2 since the general election was called in late october and on wednesday was trading near a seven month high around 1 31 and way above a low of 1 20 hit in. For some of the currencies the difference was significant.

However gbp usd has had comparatively more volatile swings relative to eur gbp but this has had more to do with gyrations in the us dollar than sterling. The gbp usd roller coaster continues with a downfall below 1 35 after the pair hit a 31 month high of 1 3539 earlier. Dollar to weaken sharply global trade boost to amplify impact of fed liquidity tsunami according to nordea the fed will need a weaker dollar to underpin its new inflation policy and the us currency is more likely to weaken amid stronger global trade.