Sterling Rallies As Johnson Floors Rivals in 1st Round, Later Falls

The Sterling pound today rallied against the US dollar in the mid-London session as Boris Johnson floored his opponents in the first round of voting within the Conservative Party. The GBP/USD currency pair had fallen earlier today as markets reacted to yesterday’s defeat of a motion to eliminate the possibility of a hard Brexit.
The GBP/USD currency pair today fell to a low of 1.2661 before rallying to a high of 1.2708 following Johnson’s win before falling back almost to its daily lows.
The currency pair opened today’s session with a bearish bias after the British Parliament rejected a motion backed by the opposition Labour Party to rule out a hard Brexit. Investors sold the pair despite Boris Johnson clarifying that he was not going to actively pursue a hard Brexit agenda given that he is regarded as a hardline Brexiteer. The release of a housing survey by the  Royal Institution of Chartered Surveyors (RICS) showing that the UK housing sector was recovering also did not boost the pair.
The release of the Conservative Party’s first-round voting results indicating that Johnson had a massive lead against his two closest competitors Jeremy Hunt and Michael Gove triggered the pair’s brief rally. The cable fell soon afterward as the US dollar’s safe-haven appeal amid renewed trade jitters drove the pair lower.
The currency pair’s future performance is likely to be affected by Brexit headlines, Mark Carney’s speech, and multiple US releases.
The GBP/USD currency pair was trading at 1.2688 as at 17:52 GMT having dropped from a high of 1.2708. The GBP/JPY currency pair was trading at 137.44 having fallen from a high of 137.79.

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