GBPUSD Price: The Pound Had a Volatile Day As Kwasi Resigned

Key points:
The GBPUSD currency pair had a tumultuous day as Kwasi resigned.
The finance minister was replaced by Jeremy Hunt, according to The Times.
However, the new finance minister faces tough choices.

The GBPUSD currency pair has had a volatile day today after rumours that Kwasi Kwarteng would be sacked as UK Finance Minister today. As the day unfolded, several names were put forth as potential successors to the role.

However, by the time of going to print, it had emerged that Kwasi had tendered his resignation to Prime Minister Liz Truss and that she had appointed Jeremey Hunt, the former foreign minister under Boris Johnson’s government, as the new Finance Minister.

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The move comes as the Prime Minister plans to walk back some of the unpopular measures unveiled in the mini-budget presented by Kwasi Kwarteng that had threatened to upend the UK bonds markets and the overall economy was it not for the Bank of England’s intervention.

The UK Times kept investors and other market participants updated on the events within Number 10 Downing Street as events unfolded rapidly. One key policy U-turn contemplated by the Prime Minister is raising corporate taxes. The move has been criticized by most investors but is popular among the public.

Many have argued that raising corporate taxes would drive many companies away from the UK and into other countries with lower taxes. However, the general public consensus is that many companies are not paying their fair share of taxes even as employees pay very high taxes.

Unlike other major currencies that benefited from the release of the mixed US retail sales data for September, the pound was still trading in negative territory against the dollar at writing. However, the GBPUSD pair was making a spirited attempt at recouping its losses.

The currency pair still faces several unknowns as Liz Truss’s government tries to win favour with the public after her predecessor Boris Johnson was ousted mainly due to his conduct and not his policies.

Truss has to earn the public trust by advocating policies that will be popular with the masses, such as the two-year cap on energy prices. Still, her position remains tenuous, with some calling for her osuter before the next general elections.

*This is not investment advice.

The GBPUSD price chart today.