Currency markets react to Macron’s call for snap election

On Sunday night Emmanuel Macron took the international community by surprise and announced a snap election in France. That decision came after the far right surged in France's European vote - the National Rally won more than double the votes of Macron's centrist alliance.

As a result, the Euro dropped in value against sterling compared to last week. This makes UK exports to the EU more expensive.

For example, on 31 May, the Euro stood at 1.1746 against sterling. The SQQ overall price week ending 1 June for new season lamb was 849.7p per kg. This would make UK lamb €9.98 per kilo.

At the time of writing, (Tuesday 11 June) the Euro stands at 1.183735, which would make the same lamb €10.09 per kilo.

The increased EU price across the board for lamb, beef and dairy is likely to put downward pressure on the domestic prices, all other things being equal, over coming days.

The effect is reversed for imported products. For instance, Irish beef coming into the UK will be cheaper, again putting downward pressure on domestic prices.

AHDB will be monitoring the exchange rate closely over the following days to determine the size and duration of this impact.