Sterling Faces Unfavorable Election Outcome

The Great Britain pound tumbled today as the Parliamentary election hasn’t showed the clear winner, confirming expectations of the hung parliament and spurring fears that the new government won’t be able to deal with the budget deficit.

The U.K. budget shortfall is 167 billion-pound ($244 billion), which is more than 11 percent of gross domestic product and the largest deficit in the Group of Seven nations. The election may face legal challenges as the voters in some parts of the Britain weren’t able to cast their votes.

GBP/USD dropped to 1.4622 as of 10:11 GMT after opening at 1.4824 today. EUR/GBP jumped to about 0.8722 up from its opening price of 0.8508.

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