Sterling exchange rates were volatile yesterday as Liz Truss announced her resignation. The pound rallied against the US dollar and edged higher than the euro.
The prime minister issued her resignation after six turbulent weeks in office and shortly after committing to the pensions triple lock. A new leader will be named next Friday.
“One silver lining we are seeing is the gilt market and sterling reacting positively to Truss’s departure,” said Stuart Clark, the portfolio manager at Quilter Investors.
The moves were smaller than with other major political changes though, with her political demise already priced in for several days and little idea yet of future economic direction.
As we prepare to welcome our third prime minister of 2022, there remains significant uncertainty about what this means for the pound, the economy and country.
Shares in the London stock market closed higher yesterday on hopes that political turmoil will soon ease.
There were no significant data releases in the UK yesterday but overnight the GfK Consumer Confidence Index for the UK came in at -47, slightly better than expected. Retail sales for September were lower than expected however, at -1.4. That’s a year-on-year decline of 6.9%.
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