UK Election – Ignores BREXIT, GREXIT and Real Economic Risks
By: GoldCore
GoldSeek.com
Thursday, 7 May 2015
UK election today expected to yield “hung parliament”
Election not seen marked decline in pound as was the case in run up to last election
Election ‘chaos’ could trigger a ‘Lehman moment’ for pound
Recent history shows Labour victory not inherently bad for sterling
Concern that Miliband’s Labour closer to that of Brown than Blair
BOE warn deficits could “trigger a deterioration in market sentiment towards the UK”
“Punch and Judy” politics ignores BREXIT, GREXIT and significant economic risk
People across Britain are going to the polls today to elect a new government. Opinion polls suggest that, as in 2010, a hung parliament is likely as neither the Tories nor Labour are likely to gain an overall majority.
The uncertainty caused by a hung parliament has historically had a negative impact on markets and on the pound as investors wait for clarity in government policy before making investment decisions. There is also the possibility of more serious market dislocations and concerns that election ‘chaos’ could trigger a ‘Lehman moment’ for the pound.
We think it is important to look at short term dynamics and long term ones.
Dominic Frisby, the precious metal and financial markets commentator at Moneyweek, has written an interesting article in which he looks at how the election result may impact the pound in the short term.
The Rest…HERE
