Could the election weaken the Pound? (Daniel Johnson)

PM shoots herself in the foot

The move to call a snap general election by the PM looked to be a shrewd one. Calling an election when the opposition was so weak was thought to almost guarantee a torie victory. Historically a snap election would weaken the currency in question, however on this occasion the opposite occurred. A torie victory is deemed as positive for the UK economy, investor confidence grew and  sterling strengthened. Since then however Theresa May has angered her core voters by stating that if the elderly have more than £100k in assets they will be forced to pay for there own care. This has caused Labor to gain ground on the Conservatives with Corbyn now only 6 points behind the conservatives. Political uncertainty historically weakens the currency in question. If we look at the last general election we saw volatility very close to the day of the vote. This could create a valuable opportunity for Euro sellers at this election.

Inflation could create big problems for the UK Economy

Many market analysts predicted there could be a sharp rise in inflation following the decision to exit the EU. This however was not the case and it seemed the country kept calm and carried on in true British fashion. Unfortunately this month we have witnessed a rapid rise from 2.3% to 2.7%. This has occurred due to the weak value of the pound. Imports are now far more expensive and retailers are passing the price increase onto consumers. The problem is average wage growth is not keeping up with inflation, if the UK general public stop spending there is the potential for recession.

If you have a short to medium term currency requirement it is crucial to be in touch with an experienced broker. Timing your trade will be vital in maximising your return during such a volatile period. If you are a Euro seller and your funds are not available until after the election, there are contract options available which allows you to buy before your funds become available.

My speciality is property transfers, I can make sure your foreign property purchase or sale goes through smoothly and effectively at the most competitive rates of exchange.

If you have a currency provider already in place I will be prepared to provide a comparison and I am confident I will be able to make you a significant saving. I work for Foreign Currency Direct PLC, we are one of the top brokerages in the country trading for over 16yrs. We are also registered with the FCA and our accounts are published online. You can trade in confidence knowing your money is safe.

Feel free to get in touch if you like my assistance by e-mailing me at [email protected]. Thank you for reading.