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Boris Johnson is the new UK Prime Minister!

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Landslide victory for Boris Johnson

It’s official, Boris Johnson will become the next UK Prime Minister, much to the detriment of the pound which has been repeatedly whacked at even the slightest whiff of a no-deal reality.

Johnson was a key figure in the leave campaign back in 2016 and has been much more convincing in his insistence that no-deal is better than a bad deal, than the incumbent Theresa May. Over the last month, that has led Johnson to claim that the UK, under his leadership, must leave on 31 October with or without a deal, which has naturally weighed further on the pound.

The initial response to the announcement has been rather subdued given the build-up to the event but then, it was so widely expected and heavily backed that it’s perhaps no surprise. Johnson comfortably led from the outset and clearly appealed more to the Tory membership when it comes to Brexit which is why few people ever gave Hunt a chance.

GBPUSD 1-Minute Chart

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The question now is whether the pound can recover from its slump in the near-term or whether the risk of no-deal is just too great and every passing week is seen to take us one week closer to the cliff-edge.

One thing is for sure, it’s going to be a very interesting few months!

GBPUSD Daily Chart

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Former Craig

Former Craig

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
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