It's been a pretty diabolical couple of weeks for currency traders, but as new Prime Minister Theresa May curtseyed to the Queen yesterday, something happened on the markets: things started to look up – suggesting May's reputation as a "safe pair of hands" may be more than just speculation…
The pound, which yesterday traded as low as $1.3106, has risen more than a cent against the dollar today, jumping as high as $1.3263 this morning, as traders' confidence began to return. In early trading in London, it was at $1.3223, 0.58 per cent higher.
Against the euro, sterling rose 0.51 per cent to €1.1915, having peaked at €1.9128 earlier this morning. Yesterday it dropped as low as €1.807, finishing the day 1.26 per cent lower.
The FTSE 100 rose 0.7 per cent to 6,718 points, prompting some to suggest it could head towards 7,000 over the next few months.
The European indices continued their remarkable recovery this Thursday, despite the uncertainty of the first Bank of England rate vote since the Brexit referendum looming on the horizon," said Connor Campbell, financial analyst at Spreadex.
"Another batch of all-time highs for the Dow Jones, and a strong Asian session for the Nikkei, has helped feed into the positive sentiment this morning."
However, he added that today's potentially landmark interest rate decision, which is expected to result in a 0.25 percentage point rate cut, could put a swift end to sterling's climb.
"Whether the pound can remain anywhere near [current] levels is now in the hands of Mark Carney and his central bank colleagues. Expect a few jitters to creep in as lunchtime approaches," he said.