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Pound crashes following Boris Johnson resignation and Brexit turmoil

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Pound crashes following Boris Johnson resignation and Brexit turmoil

10 July 2018 Tuesday 12:20
Pound crashes following Boris Johnson resignation and Brexit turmoil

Sterling fell sharply on the news that Foreign Secretary Boris Johnson has quit, just hours after Brexit Secretary David Davis also threw in the towel.

Johnson's resignation sent the pound tumbling into the red, down 0.1 percent against both the dollar and euro at 1.32 and 1.12 respectively in afternoon trade.

The British currency had been riding high earlier in the session after Davis resigned, with traders interpreting his departure as increasing the chances of a so-called "soft Brexit".

But the departure of Johnson plunges Prime Minister Theresa May into a fresh leadership crisis. Connor Campbell, financial analyst at SpreadEx, said: "With that being two Cabinet resignations in less than 24 hours, the pound began to fret about the chances of a formal challenge to Theresa May's leadership from inside the Tory party, and the subsequent potential for another general election.

"To be fair to sterling, however, it avoided falling off a cliff like it might well have done, instead producing a more measured reaction to the day's twists and turns."

The resignations of the two Cabinet "big beasts" comes just days after May secured senior ministers' agreement at Chequers for a Brexit plan about which both men had expressed reservations.

In explaining his resignation, Davis warned that the UK is giving "too much away, too easily" in the Brexit talks, claiming that the Government had gone further than it should have in the negotiations.

Staunch Brexiteer Dominic Raab was named as Davis's replacement as Secretary of State for Leaving the EU.

"The big question now is, how much of a domino effect will this Davis/Johnson double have in the coming days (and indeed hours), and whether or not May has the support to climb onto her job," Campbell added.

With the pound falling, it's rarely been more important to get the best deal possible when changing pounds.

Moneysupermarket recommends shopping around to get the best rates and looking at the total cost, not commissions, fees and rates.

That is to say - if I want €250, how much will it cost me once everything is included? For example, a “commission free” deal can work out a lot more expensive than one with a 2% fee if the exchange rate they're using isn't as good.

“The best deals are usually found online for collection from city locations and for home delivery,” Moneysupermarket added.

However, the best deals might actually be to use a card overseas. The past few years has been an explosion in the number of mobile offerings that let you spend for less overseas.

They generally are free to take out, let you buy when abroad at the best possible rates and even take out £200 fee free from foreign cash mashines.

The most popular are Revolut, Monzo and Starling, but we have a full guide below. We've also got a page on where to buy travel money to help you.

Updated: 10.07.2018 12:26
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