The British pound is tanking as recent opinion polls show support for the Conservative government falling. This implies that the U.K. could have its first first minority government since 1974.
A minority government would increase the chances for a hung parliament whereby nothing happens due to political gridlock. As our colleague Gregory White highlighted a week back, ‘A hung parliament for Britain would mean no ‘Austerity Budget,’ more market uncertainty, and a near definite credit downgrade from AAA for the country. The UK would become target number one for speculators as a result, if it isn’t already.’
Thus the pound is being slammed:
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