[vc_row][vc_column][vc_column_text]Pound comes under pressure as UK political uncertainty persists
Political volatility in the UK prompted sharp movement for the pound over the course of the last week as Theresa May saw off a leadership challenge, securing her position for another twelve months.

While the European Central Bank (ECB) followed through on plans to end its long-running quantitative easing programme this failed to offer any particular support to the euro.

Demand for the US dollar fell in the wake of an easing in November’s consumer price index, meanwhile, with markets still expecting the Federal Reserve to take a more dovish approach to monetary policy in 2019.

Although China was prepared to lower tariffs on US car imports this was not enough to shore up the risk-sensitive Australian and New Zealand dollars for long.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]UK politics drive pound Sterling volatility as Brexit anxieties persist
The pound had a volatile week and the Pound comes under pressure as Conservative MPs launched an unsuccessful leadership challenge against Theresa May and EU leaders failed to offer any fresh concessions at the latest EU summit.

As the issue of the controversial Irish backstop continues to fuel parliamentary discontent the chances of Theresa May’s proposed Brexit deal winning support remain limited at best.

With markets pricing in higher odds of a general election or second referendum GBP exchange rates saw significant volatility.

An unexpected acceleration in UK wage growth in the three months to October offered some support to the pound, although this was quickly overshadowed by political developments.

If November’s UK consumer price index eases this could put fresh pressure on GBP exchange rates, even though this would bode well for further wage growth.

A dovish performance from Bank of England (BoE) policymakers at Thursday’s policy announcement could also weigh heavily on the pound.

Signs that the BoE is willing to leave monetary policy on hold for longer would not give investors any incentive to support the pound in the near term.[/vc_column_text][/vc_column][/vc_row]