Disappointing Election Results For Theresa May

On 18^th April this year the British Prime Minister Theresa May announced that a snap general election will be held on 8^th June, i.e. yesterday, much to everyone’s surprise, despite having said more than once times after taking office that she would not call such an election.

The reason for that decision was her wish to seek a strong mandate for the upcoming BREXIT negotiations with the EU. 

The results of the elections that were held yesterday, however, must have been disappointing for the Prime Minister, as her party not only did not win a bigger majority, but lost thirteen seats (from 330 now they have 317), while the Labour Party, led by Jeremy Corbyn, won 29 seats (from 229 now they have 261 seats).

The market reacted predictably to these results – GBP/USD fell with over 320 pips (from 1.2960 to 1.2630), EUR/GBP rallied with 220 pips (from 0.8640 to 0.8860) and GBP/JPY fell with almost 300 pips (from 142.44 – 139.50). I think that the biggest question that everyone have now is what effect this parliament will have on the BREXIT negotiations.