The Pound exchange rate strengthened against the Euro on Friday as it became clear that the Conservatives were on course to form the next UK government. Against the US Dollar, the Pound surged to its best level since 2009. The vote saw the Liberal Democrats decimated while the Labour Party performed worse than predicted. Domestic house price data also offered support as prices were shown to have risen strongly in April. If it is confirmed that the Conservatives will be able to form a majority government, we could see Sterling rise as high as 1.40.

US Dollar

The US Dollar weakened against the Pound as it became increasingly clear that the Conservatives will win an overall majority in the UK general election. Against the Euro, the ‘Greenback’ strengthened as it continued to receive support from positive initial jobless claims data. The report showed that the 4-week average neared a 15-year low.

The Euro

The Euro weakened against the Pound, US Dollar and other major peers after data out of Germany showed that industrial production fell by -0.5% on a month-on-month basis and -0.1% on a year-on-year basis. Further losses were restrained as industrial production in Spain surged by 2.9% and German balance of trade came in positively.

Australian Dollar

The ‘Aussie’ weakened as the Reserve Bank of Australia cut its inflation and growth forecasts and suggested that another rate cut may be necessary over the coming months. The currency was also weakened by disappointing Chinese trade data. The Asian nation’s trade surplus rose to $34.13 billion, below expectations for a rise to $39.45 billion.

New Zealand Dollar

The New Zealand Dollar weakened against the stronger Pound Sterling as it became clear that the Conservative Party was on course to win an outright majority in the UK general election. The ‘Kiwi’ was also weighed upon by the disappointing trade data out of China.

Canadian Dollar

The ‘Loonie’ fell by more than 0.50% against the Pound as the final election results filtered through. Against the Euro, the Canadian Dollar was higher as the single currency was pressured lower by disappointing German industrial production data. The Canadian Dollar will experience volatility later in the session due to the release of the latest employment data.

South African Rand

The South African Rand was also weaker against the Pound due to the election results. Elsewhere, the Rand was softer against the supported US Dollar.