Pound Emerging as Election Loser Whichever Party Seizes Victory
(Bloomberg) -- The likely outcome of Britain's general election is finally becoming clear. The outcome, that is, for the pound.
In a bearish sign for the currency, traders are paying more to hedge against sterling losses versus the dollar now than in the weeks before the Scottish independence referendum back in September. Opinion polls ahead of the May 7 vote put the Conservative and Labour parties virtually neck and neck and investors say there are dangers whichever one ends up running the government.
"All paths lead to a degree of sterling weakness," said Daragh Maher, a London-based strategist at HSBC Holdings Plc, which sees the pound falling more than 2 percent to $1.45 by year-end. "Traditionally the pound does better if the Conservatives are expected to win and does worse if Labour are set to win. That doesn't hold so closely this time around."
Fed's Bullard says dollar near fair value but path unclear
The dollar index is not far from fair value but it is unclear how much more the U.S. currency will strengthen against the euro, St Louis Federal Reserve President James Bullard said on Monday.
Speaking on CNBC, Bullard also said an exit of Greece from the euro would be possible but prove very painful for Greece itself.
"I think it's (Grexit) much more manageable than it would have been a couple of years ago and so I do think it could be done but I don't think it's advisable to try to go down that path," he told CNBC in an interview.
Oil drops as Saudi says will not cut output alone, weak China import hurts
(Reuters) - Oil prices dropped more than 1.5 percent on Monday as China's imports weakened, while comments from top exporter Saudi Arabia that it would not unilaterally cut its output to defend prices also dragged on the crude market.
China's February crude oil imports from Iran fell 3.7 percent from a year ago to 2.04 million tonnes. China boosted overall imports late last year, taking advantage of cheap oil to build its reserves, but storage tanks could be reaching their limits, forcing a slowdown in orders.
Weak demand from top energy consumer China comes at a time when the OPEC kingpin Saudi Arabia has reiterated its decision to keep production unchanged and ride out a market slump, which has roughly halved prices since last June.