The Pound has continued its gains against The Euro as news this morning states that The German Government has collapsed. In recent months, the coalition government between The Social Democrats and Liberals have disagreed on many topics and have now failed to agree on the 2025 budget, as well as measures to take the country out of its current stagnation economically.
The finance leader for The Liberals has effectively been fired by the Social Democrats Chancellor, Olaf Scholz, and he now faces a confidence vote on 15th January. If he were to lose, as many expect then a Snap Election would be called in March, 6 months earlier.
Recent economic data from Germany had been providing some hope of an economic recovery, however a spike in energy prices as well as political uncertainty is looking to undermine business and consumer confidence, again weighing heavy on The Euro.
