Despite being appointed as Prime Minister just over a month ago on the 6th of September 2022, Liz Truss is already coming under pressure and there is speculation regarding her remaining in power already.
The Pound has traded in a more speculative fashion over the past month than it has done for years after a disastrous mini budget which sent shockwaves throughout financial markets, and saw the Pound trade against the lowest level against the US Dollar in recent history.
Truss appointed Kwasi Kwarteng as Chancellor in an ill fated move and he has already been replaced by Jeremy Hunt who has chosen to reverse almost all the tax breaks declared by Kwarteng. The Pound climbed off the back of his announcements and demonstrates the disarray the current government is in, and now Truss is coming under increasing pressure.
In the wake of new Chancellor Jeremy Hunts announcements, Liz Truss apologised for the mistakes that have been made so far.
She also made it clear that she’s not willing to give up and declared that she will lead the Tories into the next election and highlighted that by appointing a new Chancellor, she has restored economic stability.
Moving forward I think there could be further volatility for the Pound relating to speculation regarding the job security of the current PM, especially due to the Tories trailing Labour in the voting intention polls which increases the pressure on the PM. Political instability often has a negative impact on the underlying currency, so if you’re interested in the Pound’s value this is a key topic in my opinion.
Economic data releases today are light so politics will continue to drive the Pounds value today. GBP/EUR has dropped off this morning and lost over 1.5cents since the announcements from Hunt yesterday.
Inflation data will be released early tomorrow morning, so if you wish to plan a transfer around this economic release, please feel free to get in touch. As a currency specialist we have access to a number of different trading options and very competitive exchange rates.
You can contact me directly on [email protected] if you wish to discuss any of today’s topics in further details, and you can also set up rate alerts using our trading systems.