GBP/USD, GBP/EUR rally as Sterling jumps across the board on election outcome

The Pound has surged across the board as the Conservatives secure a majority and markets anticipate a quick solution to Brexit. After the exit polls were released suggesting a Tory landslide, the Pound rallied to highs of 1.3514 versus the US Dollar—the highest level since May 2018—and 1.2077 against the Euro—a near three-and-a-half-year-high. Prime Minister Boris Johnson has promised to remove the UK from the EU by January 31st, to get Brexit done. Markets have rallied on the prospect of some clarity after several years of uncertainty, and the Conservatives are expected to try and pass their divorce deal in coming weeks to prevent a no-deal Brexit. The Prime Minister will then need to negotiate trade deals before the end of 2020, after the party stated it was unwilling to extend the transition period beyond the end of the year.
 
Not only will any Brexit developments be in focus in the interim, but February’s Budget will also be in the limelight to see whether the Conservatives offer an extra boost to the recently stuttering economy. Brexit clarity could also see a return of investment in the UK, which may contribute to a stronger economic performance.
 
If you’d like to take advantage of this Sterling shift or discuss how this could affect your currency transfer, contact your Dealer or call us on 020 7989 0000 for personal transfers, or 020 3465 8202 for corporate FX requirements.