UK General Election Results
- The UK general election has ended in a hung parliament as the Conservatives failed to get a majority.
- Despite, perhaps surprisingly, gaining 12 seats in Scotland, Theresa May’s party lost a total of 12 seats across the UK with Labour out-performing expectations by gaining 29 seats with two constituencies left to announce their results.
- With two constituencies left at the time of writing, the Conservatives have won 315 seats, Labour have 261 and SNP have 35.
- Sterling plummeted last night as the exit poll was announced at 10pm. The poll predicted a hung parliament and substantial gains by the Labour party and this proved to be the case.
- Over the course of the night, GBP/EUR dropped from 1.1555 to briefly trade below 1.13 before stabilising at it’s current level of 1.1384. GBP/USD dropped from 1.2949 to 1.2674 representing a 2.12% decrease in the value of the pound versus the dollar before ticking back up to around the 1.2720.
- As we have alluded to in previous newsletters, the markets do not like uncertainty and this result gives rise to many unknowns hence the sterling weakness that we have seen overnight.
- Political analysts have this morning not only been discussing how this result occurred but how this result will effect Brexit negotiations which are due to start within the next week.
- The future of PM Theresa May is also a hot topic this morning with some calls for her to resign after what has been described has a ‘disastrous’ election campaign from the Conservatives, including one such call from Labour leader Jeremy Corbyn.
- It is expected that the Conservatives will approach the Democratic Unionist Party, which secured 10 seats, to form a coalition government. The DUP stated that they were open to talks with the Conservatives following the release of the exit poll last night.
- The ECB kept rates and QE on hold yesterday as expected but did cut inflation rate forecasts yesterday. The central bank also increased its forecasts for economic growth.
- Elsewhere US unemployment claims came in roughly as expected at 245k vs 241k expected.
- Today’s news will be dominated by the fall out of the election results and its effects on brexit negotiations.
- UK manufacturing production came in weaker than expected at 0.2% vs 0.8% expected.
- We are expecting employment data from Canada at 1.30pm in the form of employment change and unemployment rate.
|Currency Pair||Interbank Rate||% Change on Day|
|Time (GMT)||Region||Data Release||Forecast||Previous|
|13:30||CAD||Employment Change||11.5 K||3.2K|