Reuters | Jul 23, 2019 12:41
LONDON (Reuters) - Sterling recovered some losses but was little moved after news that Brexiteer Boris Johnson would replace Theresa May as prime minister after winning the leadership of the Conservative Party on Tuesday.
With Johnson long the frontrunner to win the leadership race, currency markets had already priced in his election and attention now turns to the make-up of his cabinet.
Analysts said the pound's small move higher after the announcement was a relief rally following a dismal period for the sterling in which it had fallen to more than two-year lows.
Sterling, trading around $1.2450 beforehand, rose to $1.2475, still down 0.1% on the day.
Against the euro it was little changed at 89.74 pence (EURGBP=D3), down 0.1% on the day.
"It looks to me that he got more than 60 pct so I am comfortable that's largely priced in. But now he has to turn the party mandate into a country mandate and that's going to be much much harder," said Stephen Gallo, head of European FX at BMO Capital Markets.
"As for sterling, it's a 'sell on rallies', 100%. Regardless of how you slice the cake, we will either end up with a no deal [Brexit] or a messy general election," said Stephen Gallo, head of European FX strategy at BMO Capital Markets.
British gilt yields rose marginally after the result, with two-year yields now flat on the day at 0.49% versus slightly down earlier. But they were still near three-week lows. (GB2YT=RR)
Written By: Reuters
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
More markets insights, more alerts, more ways to customize assets watchlists only on the App
More content, faster quotes and charts, and a smoother experience is available only on the App.