UK Daily Mail: ''Plot to topple Truss this week''
The UK's Daily Mail's front pages report on the Conservative party leader's plot to topple the UK's Prime Minister Liz Truss despite warnings that this could lead to an early general election.
UK politics has been a driver of financial markets given the uncertainty over Truss initially betting her premiership on true-blue pleasing tax cuts only to U-turn on the proposal and fire the head of the Treasury, Kwasi Kwarteng and replaced him with Jeremy Hunt, a long-time lawmaker who has served three previous stints as a Cabinet minister. The PM is attempting to restore confidence and rebuild her credibility with international investors and members of her own party after the “mini-budget” she and Kwarteng unveiled three weeks ago sparked political and economic turmoil.
The government’s September 23 announcement of a plan to cut taxes by 45 billion pounds ($50 billion) without detailing how it would pay for them or offering independent analysis about the impact on public finances caused havoc on the money markets as investors worried that the government's borrowing could rise to unsustainable levels. GBP/USD has been a roller coaster ride and there is little abating of the same in sight.
GBP/USD H1 chart
In the open today, there was a big bullish gap of around 50 pips:
So long as the bears stay committed on the front side of the trendline, favouring the US dollar, then the price would be expected to close the gap and on a break of the 1.1150's doors will be open for a downside extension to test below 1.1100.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
