Macro Digest: The UK General Election finally agreed, Brexit not so much Macro Digest: The UK General Election finally agreed, Brexit not so much Macro Digest: The UK General Election finally agreed, Brexit not so much

Macro Digest: The UK General Election finally agreed, Brexit not so much

Macro
Picture of Steen Jakobsen
Steen Jakobsen

Chief Investment Officer

Summary:  Labour leader Corbyn today "caved" in and will vote for motion to call General Election tonight.


When: December 9, 10 or 11th. 

Background: PM Johnson has been unable to sell his Brexit deal, now he is seeking a new mandate through a General Election.

Macro Impact: More time will pass before we get back to the issue Brexit – EU has granted a delay until January 31st. PM Johnson wants clear political mandate and the polls right now support him.

Market Impact: Market reaction muted – FTSE selling off slightly, while GBP came in bid post announcement breaking. (see charts below)

Conclusion: It increases chances of Brexit being passed by January 31st, but... it comes at the worst price – continued pause in real economic agenda’s in Europe and in the UK. UK credit-impulse will drag down UK growth through end of Q1-2020 setting up major expansionary policy from “newly elected PM Johnson” in 2020. Will UK be first in using MMT? We think so...
 
SJN_29_1
Source: The Sun Newspaper

The latest POLLS in the UK: https://www.politico.eu/europe-poll-of-polls/united-kingdom/

Conservatives @ 37%
Labour @ 24%
Lib. Dems @ 17%

We think that the end result will be a higher POLL for Liberal Democrats due to their clear stance on BREXIT, but more to come as election is called...

SJN_29_2
Source: https://www.politico.eu/europe-poll-of-polls/united-kingdom/

Hourly GBP:

SJN_29_3
Source: Saxo Bank
Hourly FTSE CFD:
SJN_29_4
Source: Saxo Bank

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15
2900
Hellerup
Denmark

Contact Saxo

Select region

International
International

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.