Sterling clearly remains poll-sensitive
Yesterday, the pound suffered another day in the demonic washing machine that is UK politics, as the losses inspired by the YouGov projections of a hung parliament were reversed on yet another poll showing the Conservatives with a strong lead. This time, Panelbase put Theresa May a solid 15 points ahead of Jeremy Corbyn, but at this point, analysing, averaging and compounding this polling appears to be worse than useless. Pollster’s failure to cast a light on both the 2015 election as well as the EU referendum has already got most analysts redirecting emails with ‘poll’ in the title directly to their junk folders.
Despite this, sterling remained on the front foot for much of the session, with GBP/USD reclaiming 1.29 in a timely fashion, but these gains have moderated overnight back toward 1.2850 at the time of writing. All it really proves is that the pound will remain responsive and sensitive to political news for the remainder of this week and much of the next, until the voters tick a box that goes beyond an opinion poll.
My postal vote arrived yesterday and so will that of around 20% of the UK voting public and as such we’re approaching the point at which ‘undecideds’ will fall in line and campaigning becomes more a point of reinforcing views and not changing them.
Trump poised to splinter from the UN on climate change agreement
Trump’s split with the G7 at the weekend troubled many, particularly his frosty reception of the Paris Accord, the 2015 United Nations deal to launch a global response to climate change and the emission of greenhouse gases. Trump has indicated that he is to withdraw the United States from the Paris Accord, joining just Syria and Nicaragua in that elite club.
Domestic backlash is inevitable; the Paris Accord is one of very few issues in the United States that polls positively in literally every state across the country. It even has support from the country’s (and one of the world’s) largest oil and gas producer ExxonMobil (NYSE:XOM), so his announcement at 1500 Washington time (2000 BST) will be carefully watched.
The day ahead
For the UK, manufacturing PMI due at 0930 BST is the highlight, with the Eurozone’s numbers crossing the wires throughout the morning. In the US, ADP Employment Change is due at 1315 BST which will certainly be eyed ahead of the nonfarm payrolls reading tomorrow.