Thursday, supported by expectations that Prime Minister Theresa May’s Conservative Party will win a majority in Britain’s election, Pound Sterling held a steady two-week high. Pound Sterling traded at $1.2960, staying near a peak of $1.2970 set on Wednesday, which counts as the currency’s highest level since May 25th.
On the other hand, the Euro held steady ahead of a European Central Bank policy announcement.
In accordance to the current Britain election, polls on Wednesday appeared to have shown that Prime Minister May is on the right course to increase her majority in parliament in Thursday’s election, suggesting her the advantage to strengthen her position in Brexit negotiations will probably pay off.
In addition, as investors remained focus on the Prime Minister’s Conservative party victory, and if the Conservative Party gains a decisive majority of more than 50 seats, which would probably, be seen as a positive outcome for sterling. Singapore’s J.P. Morgan Asset Management, Market Strategist: Jasslyn Yeo also claimed that markets appear to be evaluating in a Conservative Party majority victory.
In accordance to this event, the pound gained as much as 4% after Prime Minister may called a snap election seven weeks ago, as polls then recommended a massive win for the Prime Minister’s Conservative Party would reinforce May’s position when the Brexit negotiations opens later this June.
However, current surveys that predict outcomes ranging from a majority for the Conservatives to a suspended parliament, have seen the currency drop from the $1.30 mark it hit last month.