Pound Supported by Boris Johnson's Exit: Rabobank's Foley

The transcript discusses the market's reaction to Boris Johnson's decision not to stand again, highlighting the preference for Rishi Sunak due to his familiarity with the markets. It notes the UK's weak economic fundamentals and the potential impact on sterling. The discussion also covers market assumptions about Sunak's fiscal policy and the likelihood of Jeremy Hunt remaining as Chancellor. Finally, it addresses the potential political uncertainty if both Sunak and Penny Morden are on the ballot, which could affect market stability.

What was the market's reaction to Boris Johnson's decision not to stand again?

• The market showed no reaction.

• The market became more volatile.

• The pound was supported by the news.

• The pound weakened significantly.

Why do markets prefer Rishi Sunak as a leader?

• He is a new face in politics.

• He has a strong stance on environmental issues.

• He promises to increase public spending.

• He is familiar to the markets and has sound fiscal policies.

What assumption is made about Jeremy Hunt if Rishi Sunak becomes Prime Minister?

• He will be replaced immediately.

• He will remain as Chancellor.

• He will retire from politics.

• He will take on a different role.

What could happen if both Penny Mordaunt and Rishi Sunak are on the leadership ballot?

• It would lead to an immediate decision.

• It would bring more certainty to the markets.

• It would have no impact on the markets.

• It would bring more uncertainty to the markets.

What is the potential impact on the pound if Rishi Sunak is confirmed as Prime Minister?

• The pound is expected to weaken.

• The pound is expected to rally.

• The pound will become highly volatile.

• The pound will remain stable.