- Today the Conservative Party plan to deliver their plans for the upcoming elections.
- EUR/GBP is stuck in a consolidation range between 0.8676 and 0.8573.
Once again in the UK politics are the main driver of price action and EUR/GBP is in a special place as it will affect both currencies.
Today was supposed to be Chancellor Sajid Javid’s Autumn budget but as there is currently no parliament due to their campaigns and it has been called off.
The key event in the UK will be the Conservative Parties presentation of what the future of Britain will look like if they win the elections.
Yesterday we heard from both Labour and the Lib Dems who are second and third respectively in the polls. All the parties are promising massive fiscal spending,
The key difference between them is their plans for Brexit. The Liberal Democrats want to stay in the EU, Conservatives want to leave and Labour plan to negotiate a new deal and then maybe bring it to the people for another vote.
This all effects EUR/GBP as any scenario where there is a softer outcome will mean the pair could fall even further. This was shown when current Prime Minister Johnson agreed a deal with the EU and the EUR/GBP cross fell. It was seen as a positive step as at least the UK would leave with a deal and avoid a hard Brexit.
Today Boris Johnson is set to make a statement after dissolving parliament but it could just be in preparation for the main party speech later in the day.
Earlier in the session, there was some good news for the EUR as the retail sales and services PMI data both beat expectations. At the moment that is not enough to drive price action as there is a higher power ruling the markets after yesterday’s strong risk-on move due to the US ISM non-manufacturing PMI release. Today’s EUR pullback is largely a retracement of yesterday’s losses in the euro.
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