Rough Ride Ahead for Sterling

Finance Markets' Hope George Osborne

The markets were badly shaken by an opinion poll showing the Conservatives only 2 points ahead of Labour and forecasting a hung Parliament. Jitters have eased as a later poll shows the Conservatives 7 points ahead

The financial markets had been planning for a Conservative Government in early May 2010 with a decisive majority. The prospects of a hung Parliament shook confidence badly and prompted a major loss for Sterling. One leading finance specialist said “The only prospect worse than a hung Parliament would be for a return of the current Labour Government”.

Given fears in the money markets, Sterling is in for a very rough ride until the General Election with the prospect that anything other than a Conservative Government with a strong majority will cause Sterling to fall off the cliff it is currently poised on.

This is unfortunate because the markets are currently basing expectations on the intelligence of British voters and the conviction that the General Election will be held on May 6 2010, with a a tough emergency budget from a new Chancellor George Osborne within 50 days of the return of a Conservative Government.

The reality is that Bottler Brown has yet to call a General Election and given his track record there is a high prospect that he will dither until the last possible date in early June 2010. A further month of the Blair Brown Regime could cause further serious economic damage to Britain. It is also dangerous to expect wisdom from British voters who have been fooled three times already by the corrupt Blair Brown Regime.

Between now and whenever the Election is held, opinion polls are likely to continue to swing from one prospect to another. It should be remembered that in 1997, the polls were showing a similar narrowing of the gap between Labour and Conservative Parties with the apparent prospect of a continuation of the Major Government. In hte event, Labour won a huge majority of some 200 seats even though it received fewer votes than the Major Administration had received at the previous General Election when it was returned with a small but workable majority.

Since 1997 Labour vote rigging has made the task harder for the Conservatives who now have to poll twice as many votes as Labour to win a seat. The wild card is how many Labour voters will simply stay at home.

BSD Newsdesk

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