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British Pound (GBP): UK Chancellor Kwarteng Sacked, PM Budget U-Turn Expected

British Pound (GBP): UK Chancellor Kwarteng Sacked, PM Budget U-Turn Expected

Nick Cawley, Senior Strategist

GBP/USD - Prices, Charts, and Analysis

  • Kwasi Kwarteng is sacked after six weeks as Chancellor.
  • PM Truss is likely to make a U-turn on corporation tax.

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The UK political scene is an absolute shambles at the moment with Chancellor of the Exchequer Kwasi Kwarteng being ousted after just six weeks in office, while PM Liz Truss is said to be making a huge U-turn on her recent mini-budget later today. It looks as though Kwarteng is carrying the can for the recent mini-budget that has been derided all around.

Over the last few days, both Kwarteng and PM Truss have said that the mini-budget will not be changed or amended, although it now seems that one of the major pillars of the budget, a cut in corporation tax will be reversed. The Chancellor has already had to do a U-turn and scrap plans to cut the top rate of income tax.

Despite all the political shenanigans, Sterling is relatively calm and keeping hold of most of its recent gains. GBP/USD trades around 1.1250, while the gilt market continues to rally (yields falling) ahead of today’s final gilt purchase program.

GBP/USD Chart

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Gilt 30-Year Yield Chart

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GBP/USD Mixed
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 7% -3% 1%
Weekly -9% 1% -4%
What does it mean for price action?
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What is your view on the British Pound – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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