Pound Sterling Volatility Before the UK General ElectionApril 10, 2015 2:12 pm
It is now a month before the general election which takes place on the 7th May 2015. There has been signs of financial market tensions with investors becoming nervous about the value of the Pound. There is very little separation between the two main parties in the polls at the moment and this has caused an increase of volatility in the markets. The last time that there huge volatility in the currency markets was the immediate run up to the Scottish referendum. The current market rate for GBP – EUR is 1.380 roughly.
The EUR had regained its strength against the USD towards the end of last week but saw a big crash again this week. The current market rate at just 1.6060. The Eurozone deputy finance ministers gave Greece a six working day deadline to present proposals to enable the Euro group to come up with a deal that is to be reached.
New data was released yesterday from the Labour Department in Washington. Jobless claims have been their lowest since June 2000. Consumer confidence also gained last week to an 8 year high as Americans said now was the best time to shop. The Federal Reserve is closely watching the jobs market as it thinks about raising interest rates later on this year. The USD is extremely strong at the moment and this will continue for some time.
The central bank for Hong Kong stepped in to prevent the city’s currency from becoming stronger against the U.S. Dollar as a huge increase in stocks drove up demand. The Hong Kong Dollar has been pegged to the US Dollar since 1983, the currency was pegged at a rate of 7.8 HKD – 1 USD. However the 32 year old peg came under pressure as the Hang Seng Index had increased to a seven year high last week.
View our Currency Charts for more exchange rates over the last 12 months.
Categorised in: News
This post was written by Illy Foster