Sterling has dropped a fraction since yesterday against the dollar, coming in at 1.2915 and at 1.1667 vs the euro respectively at the time of writing. This is most likely reflecting the recent sentiment around the general election race in the UK, as the Conservative Party holds a healthy lead in the polls.
Over the last week, sterling has gained 1% over the dollar after several favourable announcements from Prime Minister Boris Johnson, who increased his popularity. However, in last night’s leadership debate, both the Prime Minister and Opposition Leader Jeremy Corbyn appeared to perform well.
All about Brexit
Last night marked the first leader debate of this general election, as a head to head between the two main party leaders. A snap YouGov poll immediately following the debate effectively put Johnson and Corbyn neck and neck. 51% said that the Prime Minister had won, and 49% said Corbyn has performed better during the debate. There were mixed responses to their policies and their form, as Corbyn was rated as more trustworthy (45% vs 40% for Johnson), but Johnson was seen as far more Prime Ministerial (54% to 29%). However, on the important question of Brexit, the Prime Minister stormed ahead, with 63% regarding him as the winner of that section of the debate, against 27% for Corbyn.
Whilst the smaller parties were not invited to take part in the leaders’ debate, the Liberal Democrat leader Jo Swinson did take part in an interview after the main event, making it crystal clear that her party’s stance on Brexit would be to revoke Article 50 on day 1 of a Liberal Democrat government. She also heavily criticised Jeremy Corbyn for not giving a straight answer over whether the Labour Party would campaign for or against Brexit in another referendum.
Swinson will be attempting to reverse the Lib Dems’ slump in popularity since the start of the campaign, with the party on 14%, its lowest number in 6 months.
Whilst the Conservative Party has a relatively clear direction on Brexit and continues to do well in the polls, we shouldn’t expect to see too much fluctuation in sterling. However, it is early days in the campaign, so anything can happen.
Will The Euro strengthen or weaken on Friday?
Keep an eye out for our Friday blog, as the euro could react to a big announcement of the HIS Markit Purchasing Manger’s Index (PMI) surveys, which measure industry output. Last month, the services and manufacturing barometers rose ever so slightly, and the markets are expecting the same for November.
For more information on what may influence your EUR/GBP transfer in the coming weeks, get in touch with me directly, Daniel Johnson at firstname.lastname@example.org, or speak with a member of our team on +44 (0)1494 292 675.