Pound Strengthens on Brexit Party News

Alan Penny

19 November 2019

2 min read

GBP slides

  • Brexit Party has decided to step down from 43 additional constituencies
  • UK PM Boris Johnson says all Conservative candidates pledged to support his deal
  • Conservatives leading in latest opinion polls on upcoming election

According to the latest news, the Brexit Party has stepped down from 43 additional constituencies where Labour won. This move will facilitate the way for a Conservative majority, which will increase the chances for the UK PM’s withdrawal agreement to pass Parliament.

Boris Johnson said that all Conservative Party candidates have supported his deal, but the market is still waiting for the confirmation. It is also important to note that the pound advanced on the news, which lifts chances of the upcoming Parliament passing Johnson’s Brexit deal.

UK election campaign takes center stage

Johnson stated on Monday that he will deliver Brexit on time. He introduced a fresh round of tax cuts and also said he will increase unemployment allowance. Finally, he will also increase the structures and buildings allowance from 2% to 3%.

The political news remains at the forefront for the investors as markets continue to focus solely on the upcoming general election, Brexit, and trade tensions. The main political parties in the UK are expected to publish their manifestos, and the pound will become headline-driven as the election gets closer.

Conservatives are leading and the Brexit Party pledged not to contest Conservative Party seats

One of the major political events in the UK this week will be a television debate between Boris Johnson and Labour leader Jeremy Corbyn, which may affect some market expectations. More opinion polls are probably going to be the major driver for the pound in the upcoming weeks. In the latest opinion polls, Boris Johnson’s Conservatives are leading and the Brexit Party pledged not to contest Conservative Party seats.

Background noise and conclusion

The UK didn’t release any relevant economic data over the last several days. The macroeconomic calendar will remain “light”, with nothing scheduled for Monday, and only the CBI Industrial Trends Survey on Orders expected for Tuesday.

The situation around Brexit has a big influence on the financial markets, with the early election in December expected to be the main driver.

Written By
Alan Penny

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