GBP: no rest for the wicked. Overview for 02.09.2022

GBPUSD keeps updating its lows; there are very few options on how to stop the plunge. 

After updating another low against the USD, the Pound Sterling is trying to reach stability. The current quote for the instrument is 1.1562.

The political factor should be cleared up as early as next Monday. The Conservative Party will announce its new leader, who will go on to become the country’s Prime Minister. Liz Truss is a favourite so far. Politicians like her. Unlike investors.

Truss has a checkered reputation despite many years of political experience and the current status of Secretary of State for Foreign, Commonwealth and Development Affairs. However, she has opponents, and if the party chooses Rishi Sunak, a young conservator and Chancellor of the Exchequer, to be the next leader, the Pound will get much support. 

All these things considered, fundamental prospects for the GBP remain negative. Neither Truss nor Sunak will be able to reverse the British currency upwards, because the crisis is only escalating. 

Nevertheless, there might be some local improvement for sure.