Private banking customers enjoy sterling boost after Brown announcement

Private banking customers with forex investments saw sterling rise against the dollar yesterday (May 10th).

The rally came after prime minister Gordon Brown announced he is stepping down as leader of the Labour Party.

It is hoped the statement will give an incentive for the Liberal Democrats to form a majority government with Labour, rather than the Conservatives, which hold the greatest number of seats after last week’s general election.

Reuters reported sterling yesterday was up 0.4 per cent on the day, trading at $1.4863. Earlier, however, it had spiked at $1.5053.

Speaking to the Wall Street Journal, Ben Potter, a research analyst at IG Markets, said of the consequences for forex traders: ’Traders are now arguably starting to have to give a little more thought to the possibility of a Labour-led government being realised.’

He stated this may unnerve the markets, which could see the move as risky because of compromises that will have to be made in order for the UK’s government to move forward.ADNFCR-2318-ID-19769809-ADNFCR