The pound fell by more than 1% on Wednesday as investors priced in many more months of Brexit and general election risk.
The news put sterling on course for its biggest daily decline in two months. The PM was dealt a blow by the UK top court, which ruled on Tuesday he had unlawfully suspended parliament, sending the pound half a percent higher. The gains where short-lived as risks remain, including a split parliament and an early general election.
Rumours of a general election surfaced as the Attorney General Geoffrey Cox responded to Patricia Cox of the SNP who called for Boris to resign. Cox asked can I encourage her then to ensure that we vote for the election motion that will come before the House shortly?” suggesting a general election looms.
The dollar consolidated on Thursday, staying near multi-week highs against most major currencies while slipping against riskier ones after U.S. President Donald Trump said there could be a trade deal with China soon. Trump stoked hopes for a trade deal by telling reporters in New York that the U.S. and China were having “good conversations” and that an agreement “could happen sooner than you think”.
12:30 – USD: GDP Annualised (Q2) precious 2% expected 2%