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Sterling Vulnerable As Boris Clings To Position

Sterling Vulnerable As Boris Clings To Position

UK Prime Minister Boris Johnson was last night hanging onto his position, after the resignation of ministers who said he was not fit to govern and with a growing number of lawmakers calling for him to step down.

Chancellor Rishi Sunak and Sajid Javid and health secretary quit on Tuesday, stating they could no longer stay in government after the latest in a series of scandals within his administration. With calls for Johnson to resign, he displayed stubbornness to continue in the role by appointing education secretary Nadhim Zahawi as his new finance minister.

As trading gets underway this morning, EUR/USD opens near December 2002 lows circa 1.0255. Given that the Euro has now fallen against the dollar below the $1.04 threshold, a move towards parity cannot be ruled out. Meanwhile, Cable (GBP/USD) operates around the 1.1670 threshold. GBP/EUR continues to change hands just above the 1.1650 handle. 

Datewise, the main release of note today will be the latest Fed FOMC meeting minutes. Additionally, speeches from two influential FOMC members (Waller & Bullard) may shed further light on the future path for official rates. A little closer to home and within the Eurozone, non-manufacturing ISM and retail data are due.

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