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UK election in focus for the week

See Wah Li
Written by
See Wah Li

See Wah Li

OFXpert

With more than 6 years of experience in the foreign exchange market, See Wah’s strength lies in developing effective solutions to help navigate the complexities of currency fluctuations.

| Monday 1 July, 2024

Daily Currency Update

The upcoming general election on Thursday is poised to be the focal event of the UK's political landscape this week. With results anticipated to be available early on Friday, significant changes are expected in the political arena.

The opposition Labour party is predicted to secure a comfortable majority, signalling a substantial shift in parliamentary power. Conversely, the incumbent Conservative party is likely to experience considerable losses. Some of these losses may translate into gains for the far-right Reform party, which is expected to capture a portion of the Conservative vote.

Despite the potential political upheaval, traders remain sceptical that the election outcome will influence the Bank of England's monetary policy and project that the Bank of England will proceed with a planned interest-rate cut, potentially as early as August, irrespective of the election results.

Key Movers

The euro experienced an uptick this morning following the initial round of France's snap election, which saw the far-right National Rally (RN) party in a leading position. Despite their advantage, the margin was narrower than many had anticipated.

Marine Le Pen's RN party emerged victorious in the first round of France's parliamentary elections on Sunday, according to exit polls. However, analysts highlighted that the party's share of the vote was smaller than what earlier polls had predicted. Meanwhile, the Japanese yen struggled to gain traction, hovering near a 38-year low, underscoring its continued weakness in the global currency markets.

Expected Ranges

  • GBP/USD: 1.2605 - 1.2695 ▼
  • GBP/EUR: 1.1735 - 1.1795 ▼
  • GBP/AUD: 1.8925 - 1.8685 ▼
  • EUR/USD: 1.0715 - 1.0785 ▼

Written by

See Wah Li

OFXpert

See Wah is passionate about supporting positive transformations when it comes to managing foreign exchange. As a Senior Currency Consultant at OFX, his goal is to help businesses make informed decisions, alleviate risks, and enhance their currency strategies for success. With over 6 years of experience in the foreign exchange market, See Wah’s strength lies in developing effective solutions to help navigate the complexities of currency fluctuations and mitigate their impacts on business profitability.