How will this snap election affect the market?
As you may know, Theresa May called a snap general election on
"The announcement to hold a general election comes as a surprise
but if we have learned anything from the Brexit vote it's that the
recruitment and job market is buoyant and robust. The general
election brings with it a level of uncertainty, but given the
relative disarray of the other parties, a positive outcome for
businesses and recruitment would have to be a Conservative
So what does the general election mean for the pound?
Sterling fell after the EU referendum then fell again in October
when markets accepted that Britain really is going to leave the
That has a range of causes.
One is that markets may expect the UK economy to grow more slowly
after Brexit, and so make the UK a less attractive place to keep
Another is that markets think Brexit will make exporting from the
UK more expensive and difficult, and so the pound falls to
compensate for that.
A third possible factor is that uncertainty means investors simply
do not know whether the UK will be a good choice or not, and the
pound has fallen to reflect that, cutting the price of UK
investments for international buyers.
Markets expect at least three rate rises, but any more beyond
that will push the dollar up even further. As one currency's rise
means another's fall, if the euro and dollar both strengthen
further then that will put pressure on sterling to weaken