Theresa May has failed to win a majority at the snap General Election, resulting in a hung parliament. This means her plan to increase her majority as we enter Brexit negotiations has backfired, leaving the country facing further uncertainty about what will happen next.
What could happen next?
Theresa May is expected to remain as Prime Minister for the time being. However, it is likely she will face significant criticism about the low visibility campaign that has failed to inspire voters and cost her at the ballot box. There are now questions about whether or not she will stay or go, and, if she goes, whether she will resign or be pushed out.
It is unclear whether the Conservatives will be able to gain sufficient support to form a coalition or minority government, or how long this process could take. In 2010, it took five days for the Conservatives to form a coalition government with the Liberal Democrats, but the process could take longer. If the Conservatives are unable to form a Government, Labour may have an opportunity to attempt to form some sort of “progressive alliance”.
It is also uncertain what this could all mean for the upcoming Brexit negotiations, which were scheduled to begin on around 19th June but which might now be delayed. In fact, the European negotiators are potentially the main winners following a difficult night for all the major UK parties.
What does this mean for the Pound?
As exit polls came in suggesting that the Conservatives would fall short of the 326 seats required for a majority, Sterling immediately fell almost 2% against the Dollar and the Euro, and more than 1% against all of its international peers.
It has continued to trade around these levels since then, but the current uncertainty could put further downward pressure on Sterling until more is known about what will happen next.
What does this mean for my money?
Whatever happens next, HiFX will be here to support you with your international money transfers. If you don’t have a HiFX account, it only takes a few minutes to sign up.
If you would like to keep an eye on the trends, we can be your eyes and ears in the market. You can monitor your currencies with our easy to use customisable charts and personalised rate alerts.
If you would like to make a money transfer, our online systems are available 24 hours a day, seven days a week. Alternatively, you may wish to consider securing the current exchange rates for up to two years with a forward contract (for transfer of over £10,000) or by using our regular payments service.
Nobody can know for sure what is going to happen next, but there could be more volatility to come while next steps are being determined. If you’d like to find out how HiFX can help you or your business, please call our friendly team of experts on 01753 859 159.
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