Sterling fell on Tuesday as the latest opinion polls show the Conservative lead over Labour is narrowing ahead of next month’s general election.
According to a poll by Kantar, the Conservatives are on 43% (-2), Labour 32% (+5), Liberal Democrats 14% (-2) and the Brexit Party 3% (+1). These latest polling results are the second poll in two days that show the Conservative lead narrowing and that Labour have closed the gap on the Conservatives to 11 points, having lead by 18 points last week. This is a significant development, as a small majority to either party heading into the election raises the prospects of a hung parliament which will likely be a GBP negative outcome.
China’s top negotiator, Liu He, raised the hopes of a trade deal between China and the US on Tuesday. The Chinese Commerce Ministry stated that Liu He held a telephone discussion with US Trade Representative Robert Lighthizer. It was stated that both sides had reached ‘a consensus on how to resolve related issues’ and ‘agreed to maintain communication on the remaining issues in the first phase of agreement negotiations’.
US President Trump echoed these developments stating that the US and China are in the final throws of reaching a trade deal.
13:30 – USD: Gross Domestic product Annualized (Q3) Expected to meet expectations of 1.9%.