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| Version 4 | Version 5 |
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| Pound remains under pressure amid political uncertainty | Pound remains under pressure amid political uncertainty |
| (about 3 hours later) | |
| The pound has resumed its downward slide as investors continue to react to the political uncertainty following last week's shock UK election result. | The pound has resumed its downward slide as investors continue to react to the political uncertainty following last week's shock UK election result. |
| Sterling had stabilised in early trade, but by early afternoon had dropped 0.6% against the dollar to $1.2672 and fell 0.7% against the euro to 1.1302 euros. | |
| On the stock market, the FTSE 100 index was down 0.1% at 7,522.25. | |
| On Friday, the pound suffered its biggest one-day drop in about eight months following the election. | On Friday, the pound suffered its biggest one-day drop in about eight months following the election. |
| One analyst said Monday's fall was triggered in part by a report from rating agency Moody's which said the inconclusive election result could affect the UK's credit rating. | One analyst said Monday's fall was triggered in part by a report from rating agency Moody's which said the inconclusive election result could affect the UK's credit rating. |
| Moody's said the election would "complicate and probably delay Brexit negotiations, a credit negative". | Moody's said the election would "complicate and probably delay Brexit negotiations, a credit negative". |
| However, it added that the government might now "consider 'softer' Brexit options, which could be credit positive". | However, it added that the government might now "consider 'softer' Brexit options, which could be credit positive". |
| Neil Wilson at ETX Capital said the comment from Moody's "seems to have woken traders from their slumber and the pound is on the defensive as we start the week". | Neil Wilson at ETX Capital said the comment from Moody's "seems to have woken traders from their slumber and the pound is on the defensive as we start the week". |
| The uncertainty caused by the election result has led business confidence to sink "through the floor", according to one lobby group. | The uncertainty caused by the election result has led business confidence to sink "through the floor", according to one lobby group. |
| A snap poll of 700 members of the Institute of Directors found a "dramatic drop" in confidence following the hung parliament. | A snap poll of 700 members of the Institute of Directors found a "dramatic drop" in confidence following the hung parliament. |
| 'Up in the air' | 'Up in the air' |
| Global currency markets are trying to work out how the election will affect the UK's exit from the European Union. | Global currency markets are trying to work out how the election will affect the UK's exit from the European Union. |
| Negotiations with Brussels are due to begin next week, with the outcome expected to have a significant impact on the economies of both the UK and the EU. | Negotiations with Brussels are due to begin next week, with the outcome expected to have a significant impact on the economies of both the UK and the EU. |
| Mrs May has been pushing for a so-called hard Brexit - where the UK leaves the EU single market and the customs union - instead of a softer Brexit, where the UK would maintain those links. | Mrs May has been pushing for a so-called hard Brexit - where the UK leaves the EU single market and the customs union - instead of a softer Brexit, where the UK would maintain those links. |
| "Certainly, prolonged uncertainty would argue for a deeper correction on sterling as May's diminished Brexit mandate scenario plays out," said Stephen Innes, senior trader at Oanda. | "Certainly, prolonged uncertainty would argue for a deeper correction on sterling as May's diminished Brexit mandate scenario plays out," said Stephen Innes, senior trader at Oanda. |
| "However, there are cooler heads in play suspecting the only real option left is the more market-friendly outcome where the UK adopts a European Economic Area-styled agreement. So, expect markets to struggle in the vortex of near-term possibilities clashing with longer-term probabilities." | "However, there are cooler heads in play suspecting the only real option left is the more market-friendly outcome where the UK adopts a European Economic Area-styled agreement. So, expect markets to struggle in the vortex of near-term possibilities clashing with longer-term probabilities." |
| Kathleen Brooks, research director at City Index, said the future direction of the pound was "still very much up in the air". | Kathleen Brooks, research director at City Index, said the future direction of the pound was "still very much up in the air". |
| "The prospect of a hard split with the EU has been kryptonite for the pound, so a potential rethink on the UK government's Brexit stance could limit [the pound's] downside, at least for now. | "The prospect of a hard split with the EU has been kryptonite for the pound, so a potential rethink on the UK government's Brexit stance could limit [the pound's] downside, at least for now. |
| "However, not even the rising odds of a soft Brexit have been enough to spark positive momentum for the pound." | "However, not even the rising odds of a soft Brexit have been enough to spark positive momentum for the pound." |