GBP finally received a much-needed respite. Last week the pair lost almost 3 figures and tested 1.30 handle. There was a reason to worry - Theresa May’s unstable political position.
It seems that today the clouds dissipated for the prime minister, as the jitters on a potential Cabinet reshuffle appeared. Mrs. May may now “brush off” Boris Johnson from the Secretary of State for Foreign and Commonwealth Affairs.
That’s sad, but at least better than uncertainty. Most of all, the in the UK has been growing since the end of 2016 from the zero and is now nearing 3% mark.
Finally, there is a good possibility of a rate hike from Bank of England. So, the sterling may see the light at the end of the tunnel.
But, let’s wait for today’s Theresa May’s speech. Any positive commentaries from the PM will help the pair to test the September 8th highs at 1.3220. If Mrs. May disappoints the markets, investors will send GBP to test the critical 1.3000.