PM Successor Concerns Weigh on GBP

Concerns about the successor to Theresa May have upstaged Brexit worries in the short term and are keeping the Pound trading close to a 4-month trough. The fear is that whomever replaces the Prime Minister may want to have a more decisive break from the European Union, which raises the probability of a confrontation with the leadership of the EU, as well as a snap election in the UK Parliament. The favorite PM contender, Boris Johnson, is prepared to leave without a deal on October 31st, though the UK Parliament is resolutely opposed to that outcome.

As reported at 11:41 am (GMT) in London, the EUR/GBP was trading at 0.8822 Pence, a gain of 0.0908%; the pair has ranged from a low of 0.88081 Pence to a high of 0.88275 Pence. The GBP/USD was trading lower at $1.2623, down 0.0602% and off the session low of $1.2611 while the high was at $1.2641.

US Data Eyed

Markets attention will turn away from the UK and towards the US with the preliminary growth figures being released by the US Bureau of Economic Analysis. According to the latest polls of economists and analysts, the 1st quarter growth will likely show a decline to 3.1% from 3.2% (on an annualized basis). Also due out today are figures on personal expenditures which are predicted to be flat for the quarter, wholesale inventories which should show some improvement, and pending home sales which forecasters are saying are likely to be considerably worse than the previous period. 

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.