Boris Johnson faces vote of no-confidence

Daily Currency Update

UK Prime Minister Boris Johnson will face a vote of no confidence at 6pm this evening after 54 Tory backbenchers triggered the vote. This has been caused by the ongoing fallout from “Partygate” after Boris Johnson faced further accusations of rule breaking during the lockdowns of 2020 and 2021. The pound was initially very unreactive to the fallout of this scandal when it first blew up, but it will inevitably be vulnerable following today's decision. The pound was already vulnerable prior to the announcement of the vote of no-confidence, due to poor growth outlook and speculation of the Bank of England changing their mind on future tightening. The pound is currently up around 0.45% for the day vs both the euro and the dollar. This could mean that the market is confident in Johnson remaining in his position come the end of the day. Should we see Johnson lose the vote of no-confidence, analysts believe the pound may plummet and push down towards the 1.24 area vs the dollar this week.