The Pound to Euro exchange rate was -0.04% lower on Monday as the pair takes a breather from the recent strong rally. Only a Spanish trade balance figure was released on Monday, which came in lower than expected. The market may wait for Wednesday’s French Presidential debate, which is followed by European inflation data.
The GBP to EUR was trading at 1.2065 ahead of those events.
Senior Tory talks of ‘war cabinet’ if Boris is ousted as PM
A senior Tory has said that a “war cabinet” could be established in the event of a leadership contest if Boris Johnson steps down or is ousted. Sir Roger Gale said the “interim administration” could be led by the deputy prime minister, Dominic Raab.
The veteran Conservative MP previously joined with the letters of no confidence in the Prime Minister, which he said remains “on the table”, but has since said it is not the right time for a leadership, due to the situation in Ukraine.
He is now interested in the possibility of putting a contest on hold if Mr Johnson resigns or is forced out of his job. His comments come as the PM enters another week where he will have to defend his role as MPs prepare to grill him on his behaviour in the partygate saga.
While Sir Roger acknowledged that the UK is not at war, “we’re pretty damn close to it”.
“I don’t actually know whether what I’m proposing is possible legally,” he said.
“But if Johnson were to resign – he probably won’t – but if he were to resign, then … if the deputy prime minister led a ‘war cabinet’ to deal with the crisis and get us through to the point when we could then have a proper leadership election, that is a possible way forward.”
French election could be swung by undecided voters
Wednesday’s televised French election debate between Emmanuel Macron and Marine Le Pen may be the key driver for the euro this week.
Le Pen had closed to a two-point gap, but now a poll on Saturday said it was closer to ten points. However, there is a chance that it could be swung by the debate as up to sixteen percent of voters are said to be undecided.
More worrying for Macron is that votes for third place candidate Jean-Luc Mélenchon have split evenly between the two finalists with 28 percent for Macron and 26 percent for Le Pen. When the two frontrunners faced off in the last election, almost all of the far-left votes went Macron’s way.
Energy is still a hot talking point for Europe with its decision to continue taking Russian gas, but Vladimir Putin said that “A reasonable replacement for Europe simply does not exist”.
“There are simply no spare volumes in the global market, and deliveries from other countries, primarily the US, which may be sent to Europe, will cost the consumers many times more,” he added.