Global Daily – UK election risk for sterling

by: Bill Diviney

UK Politics: Conservative lead has narrowed, but still look set for a majority – The UK goes to the polls in a general election on Thursday, and we should have a good idea of the outcome on Friday morning. The latest opinion polls still show the Conservatives with a comfortable lead, with the Britain Elects poll of polls moving from 11.2pt lead at the start of the campaign to a 9.7pt lead as of today. Individual polls range from a 6-15 point lead. Should the ultimate outcome be closer to the lower end of that range, we could yet end up with a hung parliament. But regional polling suggests that, while both main parties have gained at the expense of smaller parties during the campaign, the ‘Remain’ vote is much more split between Labour and Liberal Democrats than the ‘Leave’ vote is split between Conservatives and the Brexit Party (whose support has collapsed). This will make it easier for the Conservatives to get a majority, and the political betting odds on Boris Johnson remaining Prime Minister have increased from a 72% implied probability at the start of the campaign to 80% as of today, according to PredictIt. For more on the election and the macroeconomic implications, see our UK Watch: Last chance for Remain? (Bill Diviney)