Hung Parliament eats into buying Euro and Dollar rates of exchange – what next for the UK and the Pound? (Joshua Privett)

The Pound was hit heavily at 10pm last night when the first exit polls indicated a hung parliament, with buying Euro and Dollar rates immediately falling by over two cents. The gamble has not paid off for Theresa May, but luckily for Euro and Dollar buyers, the losses have not continued through the morning.

That is not to say more is yet to come.

First of all, all of the losses occurred before European markets were open to trade on the news. Therefore there may be more to come by mid-morning.

Secondly, there are a few snap decisions to make and many different routes the results of this election can take us before some form of conclusion is reached, with GBP/EUR, GBP/USD and GBP/AUD rates dependant on such decisions.

Based on these results, and due to the disparate views of the parties, it will be difficult for anyone to form a coalition government – whether Labour or Conservative led. The other two options are therefore a minority government, or calling a new election. In the latter, it is likely Theresa May will be announcing her resignation in a short-period.

A Conservative source has already said Theresa May is 50/50 to go, and she’s stopped by this morning at Conservative HQ making hints that there ‘will be significant change’. All of this is hearsay, but its undeniable she bears the brunt of the responsibility for a massive blow to Conservative Party mandate and power.

When politics hits the uncertainty button you either see stagnation on exchange rates or a deterioration in the Pound’s value, so the risk today is still very much held by anyone holding Sterling and wishing to buy a foreign currency.

The day will continue to unfold with developments emerging (likely with little warning), so I strongly recommend that if you are planning a foreign currency transfer that you are in contact with a currency broker to ensure you are not ‘caught out’ or that opportunities are not missed (particularly if you are planning to take advantage of this improvement for Sterling buying rates using Euros, US Dollars or Australian Dollars).

I am well positioned to assist anyone with a Sterling based currency requirement to time their transfer and stay informed in this fluid marketplace. You can contact me directly by calling 01484 787 478 and asking the reception team to be put through to Joshua to discuss a strategy for your transfer and your options given last night’s currency movement and the movement’s to come. You can also reach me on [email protected] and I will respond as soon as I am able.

One final point is that I have never had an issue beating the rates of exchange on offer elsewhere, and these current buying levels can be fixed in place for a future requirement you have planned using only a small deposit, eliminating any risk from further currency exchange movements.