Market Brief: Pound rallies as Tories lead polls

  • Markets update: At 13:00 GMT in London, GBP was the strongest and JPY the weakest in another risk-on session with stocks higher and gold and silver lower. Crude prices were also a little weaker.

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  • GBP found support as opinion polls over the weekend showed support for Prime Minister Boris Johnson’s Conservative party to be at their highest levels since 2017. Johnson has pledged to overhaul business rates in an effort to step the rapid decline of the High Street. But he has scrapped a plan to cut the corporation tax to 17 from 19 percent, in order to prioritise public spending instead.
  • JPY, the safe-haven major currency, fell as stocks rose in a mixed session with the UK’s FTSE up and some mainland European indices edging slightly lower. US index futures rose across the board with S&P futures up 5 handles. Sentiment was boosted by news the PBOC decided to cut its repo rate for the first time since 2015.
  • A quiet data calendar leaves the potential for subdued volatility during the North American session, unless an unexpected catalyst arrives.

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