British Pound Plunges Sharply In The Aftermath of the Shocking Election Vote
Jun, 09th 07:41
Sterling slumped against all of its major rivals on Friday after the unexpected election result for Prime Minister Theresa May, which left no single party with a clear claim to power, threw Britain into fresh political turmoil and raised concerns over the future of the country, especially the path of leaving the European Union.
The pound plunged more than 2.2 percent versus the U.S. dollar, tumbling to the lowest level since April 18 on the back of a sharp drop for the ruling Conservative Party and gains for the opposition Labour Party.
A hung parliament was officially produced after the Conservatives only won 315 seats out of 650 seats, short of the 326 seats needed for a majority. Opposition Labour snapped up 261 seats, followed by the Scottish National Party at 35 and the Liberal Democrats at 12 seats.
A hung parliament, where no single party has a majority of seats in the House of Commons, is weighing down the British Pound as the ruling Conservative Party will have no choice but relying on smaller parties to govern if it does not want their legislation to be voted down.
With Brexits talks are due to start in less than two weeks, it remains unclear who would form the next government while markets fear that negotiations on leaving the European Union will be delayed.
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