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Pound Falls On By-Election Results, Rallies Despite Upbeat NFP Report

August 2, 2019 at 16:59 by Simon Mugo

10 pound notes on the background made of 20 pound notesThe Sterling pound today fell to its daily lows as investors reacted to the results of a by-election where the ruling Conservative Party lost a crucial seat. The GBP/USD currency pair later rallied higher after the release of the upbeat US non-farm payrolls data in the early American session.

The GBP/USD currency pair today fell to a low of 1.2090 in the Asian session before rallying higher back to its opening high of 1.2145 and was near these levels at the time of writing.

The currency pair fell in the Asian session driven by investor sentiment as markets reacted to the hardline Brexit approach being championed by Boris Johnson and the European Union’s defiance. The pair fell further after results from a special election in Wales saw the Conservative Party lose a crucial parliamentary seat to the Liberal Democrats. The results put a damper on Johnson’s first week as Prime Minister and shrunk his ruling majority to just one seat even with the support of the Northern Irish Democratic Unionist Party. The release of the Markit/CIPS UK manufacturing PMI, which came in at 45.3 versus the expected 46.0 print.

The currency pair rallied higher in the American session despite the release of mostly in-line US non-farm payrolls by the Bureau of Labor Statistics. The greenback fell shortly after the release as tracked by the US Dollar Index, which hit a low of 98.09.

The currency pair’s performance over the upcoming weekend is likely to be influenced by geopolitical events.

The GBP/USD currency pair was trading at 1.2143 as at 16:58 GMT having rallied from a low of 1.2090. The GBP/JPY currency pair was trading at 129.47 having dropped from a high of 130.41.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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