Top Movers

Pound slumps amid general election speculation

By Michele Maatouk

Date: Wednesday 25 Sep 2019

Pound slumps amid general election speculation

(Sharecast News) - Sterling slumped on Wednesday, hitting its worst level in nearly two weeks amid speculation about a general election.
At 1445 BST, the pound was down 0.8% against the dollar at 1.2386 and 0.5% weaker versus the euro at 1.1276 as parliament reconvened after the Supreme Court ruled on Tuesday that Prime Minister Boris Johnson's decision to suspend it was unlawful.

With parliament back in session, attorney-general Geoffrey Cox hinted at another early election vote. He said all that was needed was "a one-line bill" that would require a simple majority. Cox went on to say that an election motion would be put before the Commons later in the day.

Labour leader Jeremy Corbyn said earlier that he would not be calling for a vote of no confidence until a no-deal Brexit has been averted. Once it is clear that such an outcome is off the table, he said his party would also call for a general election.

Spreadex analyst Connor Campbell said: "Whatever pleasure the currency took in the Supreme Court deciding Boris Johnson's prorogation of parliament was unlawful has been replaced with concern over what happens next, especially since there is increased talks of the government trying to force the country towards a general election.

"And with a busy Commons schedule this afternoon, the drama likely isn't over for the pound just yet."

David Cheetham, chief market analyst at XTB, said it was important to put the pound's decline in context and that weakness can likely be attributed to a retracement after what has been a strong push higher.

"Perhaps traders are getting just a little bit cautious on the pound as we await the next move from the PM," he said. "In the same way that the decision to prorogue effectively sped up the response by the opposition, the return of parliament could move things forward more quickly and with the government's next move far from certain some paring of the recent gains in the pound is not too surprising."

Special promo:
Trading the Forex Market? Visit FXmania.com to get advanced infomation about currencies and the Foreign Exchange Market.

..

Email this article to a friend

or share it with one of these popular networks:


Top of Page