Election reaction

Boris Johnson has swept back into No.10 and it’s full steam ahead for Brexit. What will a Conservative majority government mean for the economy and investment markets?
Steven Bell

Steven Bell

Managing Director, Portfolio Manager & Chief Economist, Multi Asset Solutions

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Boris Johnson has swept back into No.10 and it’s full steam ahead for Brexit. What will a Conservative majority government mean for the economy and investment markets?

  • Election result lifts uncertainty around Brexit ‘getting done’ but challenges remain in the months ahead.
  • The result triggered a jump in sterling, but it remains below pre-referendum levels – its valuation reflects weaknesses in the UK economy.
  • Domestically orientated shares enjoyed the biggest post-result rally – whether foreign investors choose to increase UK weightings will determine performance longer-term. 
  • We think a trade deal and the reduced likelihood of recession will encourage flows into UK equities.
  • Eyes will be on who the next Bank of England Governor is.  In the meantime, interest rates look set to remain on hold.

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