Pound US dollar exchange rate rises, all Tory candidates back Boris Johnson’s Brexit Deal

Pound US dollar exchange rate rises, all Tory candidates back Boris Johnson’s Brexit Deal

Jasper Lawler, the Head of Research at London Capital Group, said: “All 634 Conservative candidates in the coming… election have pledged to back Boris Johnson’s deal.”

“In the narrow context of this election, if all candidates are promising to back the deal, it makes it more believable that Boris can “get Brexit done”.

Investors reacted positively to signs of political cohesion within the Tory government, with increasing certainty over Brexit providing a boost for the pound to US dollar exchange rate. 

In UK economic news, today saw the release of November’s UK Rightmove House Price Index, which fell from 0.6 percent to -1.3 percent on the month.

However, with British political developments firmly in focus today, this had little effect on the GBP/USD exchange rate

The US dollar fell against the pound as demand for safe-haven currencies fell on increasing hopes for a US-China trade deal. 

Lee Hardman, an Analyst at Mitsubishi UFJ Financial Group, commented: “Market participants remain optimistic that a partial US-China trade deal will be signed soon and have welcomed tentative signs of economic improvement outside of the US, especially in the [Eurozone], both of which are eroding the relative appeal of the US dollar.”

With no notable US economic data due out today, the US dollar has remained subdued as investors seek out riskier assets. 

UK political developments will continue to drive the pound to US dollar exchange rate this week, with any further signs that the Conservatives could increase their lead against the Labour Party in polls likely to boost investor appetite for Sterling.

Published at Tue, 19 Nov 2019 00:01:00 +0000