Pound US dollar exchange rate: GBP slides as Theresa May ‘prepares to QUIT’

On Wednesday, Theresa May faced further pressure to step down after a senior member of her cabinet resigned. This rocked sentiment in Sterling as the UK currency continues to be battered by Brexit uncertainty. The Leader of the House of Commons, Andrea Leadsom quit her post yesterday evening over Theresa May’s Brexit Withdrawal Agreement. Speaking to reporters, Mrs Leadsom said that the Prime Minister’s new Brexit Bill had “elements I cannot support, that aren’t Brexit.”

Meanwhile, members of the Tory backbench 1922 Committee held a secret ballot on whether to change the party rules in regard to a motion of no-confidence in the Prime Minister. 

If rules are changed this would mean Mrs May could face a vote of no confidence immediately.

The results of the ballot are in sealed envelopes and will be opened if the Prime Minister does not agree to stand down by 10 June. 

Meanwhile, the US Federal Open Market Committee (FOMC) meeting minutes continued to signal patience, with no indication that interest rates will change. 

Many agreed with Federal Reserve Chair, Jerome Powell, who believed the recent slip in inflation was likely to be temporary. 

According to the minutes: “Members observed that a patient approach to determining future adjustments to the target range for the federal funds rate would likely remain appropriate for some time.”

The report also showed that officials had been increasingly optimistic about the 2019 economic outlook for the US before President Donald Trump decided to hike tariffs on Chinese imports. 

Looking ahead to this afternoon, the US dollar could continue to rise against the pound following the release of the US Markit composite PMI.

If April’s flash PMI jumps higher than expected, it could buoy the greenback. 

Meanwhile, on Friday the pound could slide further against the US dollar following the release of the latest UK retail sales figures. 

If April’s retail sales slid further than forecast, it could dampen sentiment in Sterling. 

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