UK elections are set to impact the forex markets in a big way. As the pound is one of the most used international currencies, traders across the world anxiously watched the election results. The elections are huge forex news and have important ramifications on global currency markets from FreedomPop’s perspective.
As a result of the Conservative party’s victory, David Cameron will continue to serve as Prime Minister of the United Kingdom. Cameron generally favors policies of low taxes, low spending with fewer welfare benefits and tight monetary policy. These policies generally lead to lower government deficits and higher interest rates on government bonds. Those two factors are the most important fundamental factors for an increased value of a currency. In this case, the pound was up about 8% in the month leading up to the election against the US Dollar and the Euro.
Now that the election in the UK is over. Traders will be watching closely for next steps. If David Cameron and the conservative party deliver on their campaign promises, it is likely that the GBP will continue to strengthen. Astute traders can take advantage of this forex brokerage news and make profitable decisions.