British Prime Minister Theresa May’s decision to go back on her promise not to call an election ended up being very good news for the pound sterling. As if markets had been taken aback and forced to reverse position, the GBP climbed more than 2% yesterday against the USD, bringing the euro along for the ride. Is this election really a good thing for the country? It will all depend on the outcome, as a strong majority would give Ms. May more negotiating leverage and a defeat could call Brexit back into question.
Already this morning, the GBP has been under pressure, gold is down slightly and stock markets are relatively stable. Given the relative scarcity of economic indicators, many observers will be checking out the Federal Reserve’s Beige Book at 2 p.m. for any signs regarding the health of the U.S. economy. The developing situation on the Korean peninsula also definitely bears watching, although for the time being, let’s just say that the “armada” promised by President Trump is taking a bit longer to get there.