17 Mar 2015
Sterling could come under ‘political’ pressure – Rabobank
FXStreet (Edinburgh) - In the opinion of Jane Foley, Senior FX Strategist at Rabobank, the upcoming May elections in the UK could put the sterling under further pressure.
Key Quotes
“UK Chancellor of the Exchequer will outline the last budget ahead of the May 7 general election”.
“Just a few months ago this budget had been dismissed as a damp squib since it was assumed that the government would be too far behind its deficit target to release any pre-election sweeteners”.
“Revisions to the first nine months of the fiscal year and a large January surplus mean that the budget outlook has since improved”.
“Speculation that the Chancellor could have some room for electioneering in the budget has thus increased. Even so, with the two main UK political parties still neck and neck in the polls, talk of hung parliaments, king makers, a second election and even a grand coalition are likely to persist”.
“In view of the wide range of political uncertainty, there is the risk that sterling could come under pressure ahead of the election”.
“To date there has been little sign of jitters and we argue that these concerns have been stifled by the relative attraction of the sterling interest rate curve”.
Key Quotes
“UK Chancellor of the Exchequer will outline the last budget ahead of the May 7 general election”.
“Just a few months ago this budget had been dismissed as a damp squib since it was assumed that the government would be too far behind its deficit target to release any pre-election sweeteners”.
“Revisions to the first nine months of the fiscal year and a large January surplus mean that the budget outlook has since improved”.
“Speculation that the Chancellor could have some room for electioneering in the budget has thus increased. Even so, with the two main UK political parties still neck and neck in the polls, talk of hung parliaments, king makers, a second election and even a grand coalition are likely to persist”.
“In view of the wide range of political uncertainty, there is the risk that sterling could come under pressure ahead of the election”.
“To date there has been little sign of jitters and we argue that these concerns have been stifled by the relative attraction of the sterling interest rate curve”.