GBP/ZAR Exchange Rate Accelerates as Conservatives Lead Polls Ahead of December Election
The Pound South African Rand (GBP/ZAR) exchange rate is trending higher this morning as the Conservatives enjoy a commanding lead in the polls as the 2019 UK election gets into full swing.
At the time of writing the GBP/ZAR exchange rate is currently trading at around ZAR19.0835, up by around 0.5% since the start of the European session.
Pound (GBP) Resilient, Gaffe by Senior Tory Fails to Dent Party’s Early Polling Figures
The Pound (GBP) is trading robustly this morning as the UK election race officially gets underway with the dissolution of parliament.
Sterling sentiment has been buoyed as recent polling data shows the Conservative party maintains a 15 point lead over Labour.
This despite the Leader of the House of Commons, Jacob Rees-Mogg making ‘insulting’ comments about the Grenfell Tower fire.
GBP investors currently favour a Tory victory, with hopes that a Conservative majority will help to break the Brexit deadlock in parliament and offer a more pro-business platform than Jeremy Corbyn’s Labour.
But with the 2019 UK election perceived as one of the most unpredictable public polls since the 2016 Brexit referendum, forecasts are for prevailing political uncertainty in the weeks ahead.
South African Rand (ZAR) Stumbles as Economic Concerns Grow
The South African Rand (ZAR) is stuck in reverse gear this morning amidst growing concerns for South Africa’s domestic growth.
Following on from last week’s bleak budget, ZAR investors fear upcoming manufacturing figures will prove equally distressing.
Analysts forecast tomorrow’s key figures will show that domestic manufacturing production contracted again in September.
Faced with gloomy economic indicators and concerns over the government’s alarming debt pile, the short-term outlook for the Rand looks increasingly fragile.
GBP Forecast: BoE Policy Decision Still to Come this Week
Turning to the second half of the week, GBP investors will focus on the Bank of England (BoE) as it concludes its latest policy meeting.
While policy changes are not predicted this month, given ongoing Brexit uncertainty and a lack of clarity in British politics ahead of the UK election, the bank’s forward guidance could influence the Pound.
This could see Sterling come under pressure if the BoE’s policy statement drops any additional hints that the bank will cut interest rates once Brexit is resolved.