At the time of writing, the Tories have so far endured a disastrous result, losing more than 850 seats and 30 councils overall. Labour has lost more than 90 seats, while the Liberal Democrats benefited from the losses with a 500-seat gain. Connor Campbell, analyst at Spreadex, said: “Sterling emerged as one of Friday’s big winners. “Cable’s 0.4 percent rise pushed it back to $1.308, having slipped under $1.30 earlier in the session, while against the euro it hit a fresh, €1.17-teasing one-month peak.

“The currency’s growth may be related to the local election results, one that say big losses for the Tories and Labour and significant gains for overtly pro-Remain parties like the Lib Dems and Greens.”

The pound had broken through the €1.170 barrier after 3pm UK time and was trading at €1.1723.

Against the US dollar, Sterling was worth $1.3110. 

Sterling dropped yesterday after the Bank of England held interest rates at 0.75 percent but warned the state of the UK economy will depend on how Britain leaves the European Union.

The pound lost ground as the UK lender said UK economic growth risks being buffeted in the near-term due to political uncertainty.

But the BoE added the economy has been boosted from companies in the UK and the European Union building stocks ahead of recent Brexit deadlines.

The BoE said it does not expect rates to reach 1 percent until the final three months of 2021. 

It is forecasting gross domestic product (GDP) in Britain to grow by 1.5 percent this year, up from just 1.2 percent forecast in February.

Jeremy Cook, head of currency strategy at WorldFirst in London, suggested the pound is still being dictated to by Brexit.

He said: “Sterling is not reacting to the bank’s latest decision.

“The pound takes its orders from Westminster, not the City at the moment.”

Sterling has struggled in recent weeks due to lack of Brexit movement, but managed to claw back ground on Wednesday after reports suggested the tone of Conservative and Labour talks had improved.

Before the decision for Britain to leave the EU took place, the pound was trading at $1.50 against the US dollar.

A Reuters poll recently found analysts are forecasting the pound to go as high as $1.45 in the run-up to the new divorce date of 31 October, 2019.

On the lower end of predictions, currency watchers anticipated $1.23.

John Fahey at AIB said: “In the event of progress with regard to the Withdrawal Agreement being passed by the UK Parliament or if a parliamentary consensus emerges, sterling could rally.

“Any move that markets view as increasing the probability of a no-deal Brexit could see sterling come under pressure.”

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