From Brexit, trade tariffs to the uncertainty surrounding leadership changes, the British pound has recently weathered a rollercoaster of ups and downs. Following weakened growth in the second half of 2025, economists warn the slowdown could intensify in 2026 as over half (56%) of people polled think the UK will be in recession this year – slightly above the global average of 48%.
For investors, these political and economic twists are far more than headlines as every shift can spark sudden swings in currency markets, affecting risk, returns and trading opportunities.
Which political events have moved the pound the most?
By analysing the pound’s movement immediately before and after key UK political moments from 2020, the firm BrokerChooser has uncovered the moments that strengthened the pound the most – and those that sent it tumbling. The insights have been provided to Digital Journal.
Notably, the Bank of England’s emergency bond purchase on 28 September 2022 delivered the pound’s biggest single-day boost in recent years, lifting GBP/USD by a notable +1.33%. This came just days after the sharpest single-day decline of -3.52%, triggered by the 23 September ‘Mini Budget’ disaster, which announced the biggest tax-cutting measures in 50 years without clear funding plans.
Key political moments that boosted the pound revealed
| Event | Date of event | GBP/USD on event day | Date | GBP/USD day before | % change |
| Bank of England emergency bond purchase | 28 September 2022 | £1 = $1.0857 | 27 September 2022 | £1 = $1.0714 | +1.33% |
| Rishi Sunak’s first speech as Prime Minister | 25 October 2022 | £1 = $1.1453 | 24 October 2022 | £1 = $1.1309 | +1.27% |
| UK officially leaves the EU | 31 January 2020 | £1 = $1.3205 | 30 January 2020 | £1 = $1.3086 | +0.91% |
| Boris Johnson’s resignation speech | 7 July 2022 | £1 = $1.2027 | 6 July 2022 | £1 = $1.1926 | +0.84% |
| Rachel Reeves delivers Autumn Budget 2025 | 26 November 2025 | £1 = $1.3245 | 25 November 2025 | £1 = $1.316 | +0.64% |
| Trump’s ‘Liberation Day’ tariffs | 2 April 2025 | £1 = $1.3004 | 1 April 2025 | £1 = $1.2927 | +0.59% |
| Keir Starmer’s election victory speech | 5 July 2024 | £1 = $1.2813 | 4 July 2024 | £1 = $1.2757 | +0.44% |
| UK – EU major trade and defence reset agreement | 19 May 2025 | £1 = $1.3357 | 18 May 2025 | £1 = $1.3302 | +0.41% |
| Trump’s UK visit and trade talks | 16 – 18 September 2025 | £1 = $1.3649 | 15 September 2025 | £1 = $1.3604 | +0.33% |
| Liz Truss resignation | 20 October 2022 | £1 = $1.1231 | 19 October 2022 | £1 = $1.1212 | +0.17% |
| Labour election victory | 4 July 2024 | £1 = $1.2757 | 3 July 2024 | £1 = $1.2746 | +0.09% |
Also notable was Rishi Sunak’s first speech as Prime Minister on 25 October 2022, which strengthened the pound by 1.27%. Sunak’s appointment came after weeks of political chaos and fiscal uncertainty under Liz Truss, and markets welcomed his pledge to place “economic stability and confidence at the heart of this government’s agenda”.
Despite being a highly divisive move, the third largest strengthening event came on 31 January 2020, when the UK officially left the European Union, lifting GBP/USD by 0.91%. While Brexit had weighed heavily on sterling for years, the finality of the UK’s departure allowed investors to reprice the pound with greater clarity over the country’s future economic direction.
Key political moments that put the GBP under pressure
| Event | Date of event | GBP/USD on event day | Date | GBP/USD day before | % change |
| UK ‘Mini Budget’ announced by Chancellor Kwasi Kwarteng | 23 September 2022 | £1 = $1.0858 | 22 September 2022 | £1 = $1.1254 | -3.52% |
| Jeremy Hunt delivers Spring Budget 2023 | 15 March 2023 | £1 = $1.2068 | 14 March 2023 | £1 = $1.2151 | -0.69% |
| Rachel Reeves delivers Autumn Budget | 30 October 2024 | £1 = $1.2958 | 29 October 2024 | £1 = $1.3013 | -0.42% |
| First nationwide COVID-19 lockdown in the UK | 23 March 2020 | £1 = $1.1592 | 22 March 2020 | £1 = $1.162 | -0.24% |
| Chancellor Rishi Sunak delivers Budget 2021 speech | 3 March 2021 | £1 = $1.3927 | 2 March 2021 | £1 = $1.3954 | -0.19% |
| Macron’s state visit to the UK | 8 – 10 July 2025 | £1 = $1.3594 | 7 July 2025 | £1 = $1.3617 | -0.17% |
From the above table, the largest single-day fall in the pound came after the UK’s ‘Mini Budget’ was announced by Chancellor Kwasi Kwarteng on 23 September 2022. This triggered a 3.52% plunge in GBP/USD, sending the currency to a 37-year low against the dollar. Markets reacted sharply to the biggest tax-cutting measures in 50 years, which were estimated to reduce Treasury revenues by around £45 billion in 2026/27. The scale of the largely unfunded tax cuts and the prospect of significantly higher borrowing prompted a rapid sell-off.
Other notable declines also occurred during budget-related events, with Jeremy Hunt’s Spring Budget on 15 March 2023 causing a 0.69% fall, while Rachel Reeves’ Autumn Budget on 30 October 2024 saw GBP/USD slip by 0.42%.
