{"id":5197,"date":"2019-01-17T00:00:00","date_gmt":"2019-01-17T05:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100815-gbp-usd-no-confidence-vote\/"},"modified":"2019-01-17T00:00:00","modified_gmt":"2019-01-17T05:00:00","slug":"100815-gbp-usd-no-confidence-vote","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100815-gbp-usd-no-confidence-vote\/","title":{"rendered":"GBP\/USD: Pound Climbs As PM Theesa May Survives"},"content":{"rendered":"<p>The pound closed higher versus the dollar on Wednesday after Theresa May survived the vote of no confidence in Parliament. The pound spiked to a high of US$1.2898 before paring some gains to close at $1.2887.<\/p>\n<p>Theresa May survived the no confidence motion in Parliament winning by 325 votes to 306 votes. The motion was tabled by the opposition leader Jeremy Corbyn following Theresa May\u2019s crushing Brexit defeat earlier in the week. This no confidence vote was a much closer race than what market participants had been expecting. However, a win is a win and Theresa May will remain as Prime Minister.<\/p>\n<p>The pound spiked higher following the result. This is a reflection of the stability that keeping Theresa May as Prime Minister brings, particularly given the Brexit uncertainties.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>How does political stability boost a currency?<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Political stability boosts both consumer and business confidence, which means corporations and regular households alike are more likely to spend money. The increased spending, in turn, then boosts the economy. Foreign investors prefer to invest their money in politically stable countries as well as those with strong economies. For foreign investors to put their money into an economy, they need local currency. As they acquire the money needed, the demand for that particular currency increases, which then boosts its value.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Now investors will switch their full attention towards Theresa May\u2019s Plan B. Theresa May now has until 21st January to present her plan B. This could include renegotiating, extending article 50, putting the vote to Parliament a second time, a second referendum or a no deal Brexit.<\/p>\n<p>Any steps away from a no deal Brexit could support the pound. This is because a no deal, hard Brexit would be detrimental to businesses and consumer confidence. It would therefore negatively impact the UK economy and the pound.<\/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<h2><a href=\"#dollar-struggles-for-direction-amid-us-government-shutdown\" id=\"dollar-struggles-for-direction-amid-us-government-shutdown\"><\/a>Dollar Struggles For Direction Amid US Government Shutdown<\/h2>\n<p>The dollar broadly higher on Wednesday. However, this was more thanks to euro weakness than any dollar strength story. With the US government still on shutdown, the markets are not receiving any of the economic data which is needed to assess the economy.<\/p>\n<p>With little in the way of data from the US, the dollar looked towards the euro. The dollar trades inversely to the euro. Concerns over the health of the eurozone economy following another week of soft economic readings sent the euro lower. This boosted the dollar.<\/p>\n<p>Today, the government shutdown continues. Some data such as housing starts, and initial jobless claims will be released. Investors are likely to watch these more closely than usual given the lack of anything else to go on.<\/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>The pound closed higher versus the dollar on Wednesday after Theresa May survived the vote of no confidence in Parliament. The pound spiked to a high of US$1.2898 before paring some gains to close at $1.2887. Theresa May survived the no confidence motion in Parliament winning by 325 votes to 306 votes. The motion was [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":5198,"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-5197","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 Climbs As PM Theesa May Survives - 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\/100815-gbp-usd-no-confidence-vote\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Fiona Cincotta\" \/>\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\\\/100815-gbp-usd-no-confidence-vote\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100815-gbp-usd-no-confidence-vote\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/USD: Pound Climbs As PM Theesa May Survives\",\"datePublished\":\"2019-01-17T05:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100815-gbp-usd-no-confidence-vote\\\/\"},\"wordCount\":719,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100815-gbp-usd-no-confidence-vote\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100815-gbp-usd-no-confidence-vote.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\\\/100815-gbp-usd-no-confidence-vote\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100815-gbp-usd-no-confidence-vote\\\/\",\"name\":\"GBP\\\/USD: Pound Climbs As PM Theesa May Survives - 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