The world of Forex moves quickly and just about anything can have an effect on it. The Prime Minister has a huge potential to change the value of various currencies and impact these markets around the world. Theresa May’s speeches in particular move the value of the pound massively.
Brexit has had a phenomenal effect on global currencies, with the pound plummeting in value almost overnight. The speeches made around this time by the Prime Minister actually bolstered the pound somewhat. When she announced the fact she’d be taking over the role, the pound recovered slightly.
On the 17th of July 2016, Prime Minister May delivered her first speech on Brexit strategy. The pound rose 2% against the dollar thanks to the strong and collected speech that seemed set to reassure traders in the value of the currency.
So what does this mean for forex traders? Day traders can line up their trades to coincide with the dates of important speeches. This can be a risky strategy though, as you’re not sure which way the market will turn after a poor or great speech. Forex trading is always volatile and these speeches can help traders make a lot of money.
Snap General Election
In April of 2017, the announcing of a snap general election rocked the pound once more. This dropped the value of the pound initially but by the end of the day, it had been brought up to a dollar value of $1.27. This was the highest it had been since the previous year and restored some faith in the market.
Many traders were banking on the snap general election to devalue the pound and traded accordingly. Those that closed out early would have been able to make the most of this but those that waited until the end of the day would have lost out. In this scenario, a speedy forex platform like ETX Capital, is essential to trade quickly and successfully.
The Conservative Party Conference
It will come as no surprise to political types that the keynote speech at the Conservative Party Conference did no favours for the pound. The speech was riddled with issues and almost comical problems, which lowered the value of the pound by 0.4% against the Euro.
The speech started poorly, with Prime Minister May clearly suffering with a bout of the cold. From there, prankster Lee Nelson infiltrated the speech with a political stunt. Finally, the letters on the back of the stage declaring the party began to fall off. Overall, the speech didn’t exactly inspire traders with confidence.
While these may seem like silly or irrelevant details, but they all have an effect on the pound. This speech was a tricky time for the pound, but it did start to recover thereafter.
The Prime Minister very clearly has an effect on our currency and forex traders do well to watch out for these speeches. In a volatile trading environment, this can be just enough to tip the scales and create a profit.