UK Election Result Will Balance On Brexit?
British elections have been implemented and from a market standpoint, there are potential problems that will disrupt the Brexit process.
The currently ruling Conservative Party is unable to win a majority for parliament and this is thought to have the potential to shake up the UK economy as well as raise uncertainty over the Brexit negotiations for less than two years into the future.
According to the provisional vote, the Conservative Party is only able to reach 314 seats, whereas it takes 326 seats to reach a majority status. The current Conservative Party (before yesterday's election) has 330 seats in parliament. Meanwhile, the opposition - Labor Party - is expected to gain 266 seats, followed by a 34-seater National Scottish Party and a Liberal Democrat Party with 14 seats.
Analysts fear that this kind of parliamentary composition - commonly called a "hung parliament" - will aggravate and slow down the process of negotiating Brexit.
Hung parliament or "hanging parliament" is a term used when no party has a majority in parliament. Another term used is the balanced parliament.
The final result of the new vote count will be obtained on Friday of the UK time. Thus not necessarily will happen hung parliament, considering that in 2015 also been expected to happen hung parliament but in reality Conservative managed to become the majority.
The election was held after Prime Minister Theresa May in April called for an accelerated election to consolidate powers in parliament that allowed him to pass the Brexit strategy and strengthen his position in talks with the European Union. At that time, his party was reaping strong support according to the survey. But apparently after several mistakes in the campaign, support for the Labor Party has been significantly reduced in recent weeks.
The election results were followed by the weakening of the UK around 1.31 percent against the USD to a seven-week low around 1.2707. Market sentiment turned negative due to concerns about the hung parliament that could potentially threaten Britain's position in the Brexit talks.
The problem is within 11 days of Brexit negotiations should start. Since Theresa May has commenced the implementation of Article 50, the official process of British divorce from the EU began to take place at the end of March 2019. With much negotiation to do, Britain should not be wasting any time. Though there have been at least seven days wasted during the campaign period. The more time wasted, the greater the risk of failure of negotiation.
Nevertheless, there is a clear dividing line between the pound sterling exchange rate and the Brexit negotiations. According to Kallum Pickering, senior British economist at Berenberg said that the hung parliament could force a compromise between parties. If compromise is reached, there is a possibility that the Brexit process will actually be more soft and may foster positive sentiments for the long term.
The currently ruling Conservative Party is unable to win a majority for parliament and this is thought to have the potential to shake up the UK economy as well as raise uncertainty over the Brexit negotiations for less than two years into the future.
According to the provisional vote, the Conservative Party is only able to reach 314 seats, whereas it takes 326 seats to reach a majority status. The current Conservative Party (before yesterday's election) has 330 seats in parliament. Meanwhile, the opposition - Labor Party - is expected to gain 266 seats, followed by a 34-seater National Scottish Party and a Liberal Democrat Party with 14 seats.
Analysts fear that this kind of parliamentary composition - commonly called a "hung parliament" - will aggravate and slow down the process of negotiating Brexit.
Hung parliament or "hanging parliament" is a term used when no party has a majority in parliament. Another term used is the balanced parliament.
The final result of the new vote count will be obtained on Friday of the UK time. Thus not necessarily will happen hung parliament, considering that in 2015 also been expected to happen hung parliament but in reality Conservative managed to become the majority.
The election was held after Prime Minister Theresa May in April called for an accelerated election to consolidate powers in parliament that allowed him to pass the Brexit strategy and strengthen his position in talks with the European Union. At that time, his party was reaping strong support according to the survey. But apparently after several mistakes in the campaign, support for the Labor Party has been significantly reduced in recent weeks.
The election results were followed by the weakening of the UK around 1.31 percent against the USD to a seven-week low around 1.2707. Market sentiment turned negative due to concerns about the hung parliament that could potentially threaten Britain's position in the Brexit talks.
The problem is within 11 days of Brexit negotiations should start. Since Theresa May has commenced the implementation of Article 50, the official process of British divorce from the EU began to take place at the end of March 2019. With much negotiation to do, Britain should not be wasting any time. Though there have been at least seven days wasted during the campaign period. The more time wasted, the greater the risk of failure of negotiation.
Nevertheless, there is a clear dividing line between the pound sterling exchange rate and the Brexit negotiations. According to Kallum Pickering, senior British economist at Berenberg said that the hung parliament could force a compromise between parties. If compromise is reached, there is a possibility that the Brexit process will actually be more soft and may foster positive sentiments for the long term.
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