Analysts at Scotiabank explained that sterling is under-performing on the day following the resignation of UK Home Sec. Rudd over the weekend.

Key Quotes:

“Rudd had become caught up in an immigration row and was found to have misled parliament on an issue.”

“Her replacement is Sajid Javid, an EU-skeptic and Rudd’s ouster tilts the composition of PM May’s cabinet a little more clearly towards the Eurosceptical.”

“This may complicate the PM’s own position as she tries to steer her party through the Brexit policy maze and may dampen the market’s hopes for a soft Brexit.”

“Political risks are rising just as the economy appears to be faltering—which is a poor combination for the pound.”

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