The UK General Election 2015 is finally here, who will you vote for and who will be elected? We will find out late tonight, early tomorrow. Yesterday, the penultimate day of campaigning saw a last ditch effort for votes. Still, we are yet to see any one leader make significant gains in the polls after the latest poll showed Labour and Conservatives deadlocked. As it remains, a hung parliament looks likely with speculation growing of a minority Government. Should this transpire, we anticipate the political uncertainty caused would have a negative effect on the Pound. Also weighing on the Pound, would be any further news on a possible UK referendum. A YouGov Poll earlier this week showed the UK would vote 45% to remain part of the EU and 33% to leave. This would be another political event that would add further strain to the Pound.
Economic data yesterday helped distract the market ahead of today’s General Election. UK services PMI, Eurozone retail sales and the US ADP non-farm figure was released yesterday. Services in the UK posted its best reading since September 2014 at 59.5 as the UK’s biggest sector continues its bullish trend. Eurozone retail sales was poor as per usual, missing expectations and posting a -0.8% figure.
Finally, ADP employment change which is seen as a pre cursor to Friday’s all important non-farm pay roll posted a worse than expected at 169K, leading to speculation that Friday’s figure will be bearish. Also yesterday, Fed Chair Janet Yellen sent the Greenback tumbling as she addressed the market in a dovish tone. Yellen expressed caution in the long term interest rate which sent GBP/USD and EUR/USD higher late afternoon.
Today’s focus will be dominated by election hype and a last gasp effort for votes by all candidates. The economic calendar is fairly light however, we have unemployment claims from the US.