Article taken from: finance.yahoo.com
Pound Off High as Brexit Party Tops Early U.K. EU Vote Results More — The pound’s initial gains were trimmed after the hard-line Brexit Party took the lead in the first wave of results of the nation’s European parliamentary election. Sterling erased gains of as much as 0.3% as Nigel Farage’s new single-issue Brexit Party winning 39% of the vote in the northeast of England, the first full result. The swing may harden the stance the next Tory leader takes toward Britain’s divorce from the European Union, following Prime Minister Theresa May’s resignation Friday. The results cap a month of misery for the pound, in which the currency posted a record losing streak against the euro and touched a four-month low versus the dollar.
The weakness has been driven by speculation that May’s tenure was coming to an end and her successor may try and take the U.K. out of the EU without a deal. However, such an approach is likely to be opposed by most U.K. lawmakers and would raise the risk of a snap general election. A no-deal exit would be negative for the economy, increase the chance of an interest-rate cut and weigh on sterling. The pound edged 0.1% higher to 1.2728 as of 8.50 a.m. in Sydney, and inched up 0.1 percent to 88.07 pence per euro.
” Ahead of May leaving office on June 7, investors have already turned their attention to who could replace her.
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