Sterling Makes Modest Gains Following Cabinet Reshuffle by PM Rishi Sunak


In a move that echoed through financial markets, British Prime Minister Rishi Sunak undertook a cabinet reshuffle on Monday, elevating former Prime Minister David Cameron to the position of foreign minister while simultaneously dismissing Interior Minister Suella Braverman.

The impact on the financial landscape was subtle, with analysts emphasising that short-term fluctuations in sterling would be steered more by economic indicators and the U.S. dollar's trajectory than immediate political developments in the UK.

Indicative pricing only

As of the latest update, the British Pound exhibited a 0.2% increase, reaching $1.2248, and a similar uptick against the euro, standing at 87.28 pence.

While the reshuffle prompted a 0.6% rise in the FTSE 100 and a 3 basis points drop in the benchmark 10-year UK gilt yields, experts suggest that domestic political matters, including cabinet shifts, may not exert significant influence on global investors.

Investors are turning their attention to the upcoming release of the consumer price index (CPI) for October on Wednesday. Economists polled by Reuters anticipate a 4.8% year-on-year increase, a decrease from September's 6.7%. This shift is attributed to the slower ascent in the costs of essentials such as energy and food in recent months.

Finance Minister Jeremy Hunt is set to present the autumn budget next week, focusing on curbing inflation to stimulate growth. This comes after data revealed that Britain's economy, while avoiding recession in the July-September period, failed to register growth.

Sunak's strategic reshuffle, seen as an effort to introduce centrist and seasoned figures, particularly with Cameron's return, indicates a desire for a more experienced approach rather than catering to the right-wing faction of the party that supported Braverman.

Suella Braverman's removal is not anticipated to have a considerable impact on FX markets, with Sunak expected to pursue measured actions and a general election too distant to significantly influence FX considerations. Attention will be directed toward UK CPI figures later in the week, offering potential insights into the trajectory of the British Pound.

Trade global forex with the Innovative Broker of 2022*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about trading forex with FXOpen.

* FXOpen International, Innovative Broker of 2022, according to the IAFT

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Financial Market News

Weekly Market Wrap With Gary Thomson: AUD/JPY, RATE HIKES, S&P 500, WTI Oil Weekly Market Wrap With Gary Thomson: EUROPEAN CURRENCIES, US GDP NEWS, OPEC+, NATURAL GAS PRICES Weekly Market Wrap With Gary Thomson: NASDAQ’S NEW TOP, USD/CAD NEWS, WTI OIL, NVDA SHARES DECLINE Federal Reserve's 2024 Interest Rate Outlook: A Measured Descent Expected Weekly Market Wrap With Gary Thomson: EUR/GBP’s NEW HIGH, US INFLATION, S&P500 FORECAST, BRENT CRUDE

Latest articles

Financial Market News

Weekly Market Wrap With Gary Thomson: AUD/JPY, RATE HIKES, S&P 500, WTI Oil

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of  FXOpen UK, as he breaks down the most significant news reports and shares his expert insights. AUD/JPY: Rate Falls

Trader’s Tools

Fixed Exchange Rates: Benefits and Limitations

Fixed exchange rates, a cornerstone of international finance, play a pivotal role in shaping global commerce and investment landscapes. This article delves into their intricacies, exploring the historical evolution, practical understanding, and the balance of benefits and challenges they present.

Trader’s Tools

Alternative Investment Options

Traders and investors are increasingly turning to alternative investment options to diversify their portfolios and seek new avenues for potential returns. In this FXOpen article, we discuss alternative investments, examining the types and explaining the reasons why they are gaining

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.