{"id":5195,"date":"2019-01-16T00:00:00","date_gmt":"2019-01-16T05:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100813-gbp-usd-no-confidence-vote-uk\/"},"modified":"2019-01-16T00:00:00","modified_gmt":"2019-01-16T05:00:00","slug":"100813-gbp-usd-no-confidence-vote-uk","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100813-gbp-usd-no-confidence-vote-uk\/","title":{"rendered":"GBP\/USD: Pound Firm Ahead Of Vote of No Confidence"},"content":{"rendered":"<p>After falling steadily versus the dollar, the pound surged following the Brexit vote in Parliament. The pound dropped to a day\u2019s low of US$1.2672 before jumping to a high of US$1.2917.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>What do these figures mean?<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>\n<p> When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the current equivalent. As the market moves, the amount will vary from minute to minute. <\/p>\n<p> For example, it could be written: <em>1 GBP = 1.28934 USD<\/em> <\/p>\n<p> <em>Here, \u00a31 is equivalent to approximately $1.29. This specifically measures the pound\u2019s worth against the dollar. If the US dollar amount increases in this pairing, it\u2019s positive for the pound.<\/em> <\/p>\n<p> Or, if you were looking at it the other way around: <em>1 USD = 0.77786 GBP<\/em> <\/p>\n<p> <em>In this example, $1 is equivalent to approximately \u00a30.78. This measures the US dollar\u2019s worth versus the British pound. If the sterling number gets larger, it\u2019s good news for the dollar.<\/em> <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>As analysts had expected, Theresa May lost her Brexit vote in Parliament. The UK Prime Minister suffered a crushing defeat, which saw her lose by 230 votes. 432 voted in against the Brexit deal, whilst just 202 voted in favour. The scale of the defeat prompted opposition leader Jeremy Corbyn to table a vote of no confidence for tomorrow.<\/p>\n<p>The pound rebounded off session lows as investors took an optimistic view. This defeat is being seen as a step towards extending Article 50, rather than the start of a no deal Brexit. The hope is that extending Article 50 could result in a better deal or even Brexit not ever actually happening.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>Why is a \u201csoft\u201d Brexit better for sterling than a \u201chard\u201d Brexit?<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>A soft Brexit implies anything less than UK\u2019s complete withdrawal from the EU. For example, it could mean the UK retains some form of membership to the European Union single market in exchange for some free movement of people, i.e. immigration. This is considered more positive than a \u201chard\u201d Brexit, which is a full severance from the EU. The reason \u201csoft\u201d is considered more pound-friendly is because the economic impact would be lower. If there is less negative impact on the economy, foreign investors will continue to invest in the UK. As investment requires local currency, this increased demand for the pound then boosts its value.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Today Theresa May will face a vote of no confidence from the opposition. Analysts are expecting her to survive given that the DUP and other Tory rebels have guaranteed their support towards her.<\/p>\n<p>So what next? On surviving a vote of no confidence, Theresa May has until 21st January to put forward her Plan B for Brexit.<\/p>\n<h2><a href=\"#dollar-strength-unlikely-to-last\" id=\"dollar-strength-unlikely-to-last\"><\/a>Dollar Strength Unlikely To Last<\/h2>\n<p>The dollar traded broadly higher on Tuesday. However, this was mostly associated to euro weakness rather than any resounding dollar strength. The dollar trades inversely to the euro. Given the euro fell sharply on weak German GDP data, this boosted the US dollar.<\/p>\n<p>Strength in the dollar is unlikely to remain given the increasingly dovish tone of the Fed. With Fed raising questions over the outlook of the US and global economy, investors and Fed officials themselves are doubting whether the central bank can hike rates as planned this year.<\/p>\n<p>Adding to dollar woes, the US government shutdown continues. Data is not reaching the markets as it should which is muddying the picture for investors. Furthermore, the shutdown means that government employees are not being paid. This will not be doing any favours to the economy and could result in a softer quarter for economic growth.<\/p>\n<hr>\n<p><small><\/p>\n<p><small><em><br \/>\nThis publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Inc., Currency Live or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. Consult our <a href=\"https:\/\/currencylive.com\/risk-warning\/\">risk warning<\/a> page for more details.<\/em><\/small><\/p>\n<p><small><em>This article was initially published on TransferWise.com from the same author. The content at Currency Live is the sole opinion of the authors and in no way reflects the views of TransferWise Inc.<\/em><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"<p>After falling steadily versus the dollar, the pound surged following the Brexit vote in Parliament. The pound dropped to a day\u2019s low of US$1.2672 before jumping to a high of US$1.2917. What do these figures mean? When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the [&hellip;]<\/p>\n","protected":false},"author":163946598,"featured_media":5196,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1379,1381],"tags":[1394,1398],"class_list":["post-5195","post","type-post","status-publish","format-standard","has-post-thumbnail","category-gbp","category-usd","tag-gbp","tag-usd"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>GBP\/USD: Pound Firm Ahead Of Vote of No Confidence - Currency Live<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/currencylive.com\/news\/100813-gbp-usd-no-confidence-vote-uk\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Ileana Ionescu\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/\"},\"author\":{\"name\":\"Ileana Ionescu\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/3d5cb0a6a22d357fc0b9ad562f35e75b\"},\"headline\":\"GBP\\\/USD: Pound Firm Ahead Of Vote of No Confidence\",\"datePublished\":\"2019-01-16T05:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/\"},\"wordCount\":752,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100813-gbp-usd-no-confidence-vote-uk.jpg\",\"keywords\":[\"gbp\",\"usd\"],\"articleSection\":[\"GBP\",\"USD\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2019\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100813-gbp-usd-no-confidence-vote-uk\\\/\",\"name\":\"GBP\\\/USD: Pound Firm Ahead Of Vote of No Confidence - 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