[h8kurdt]

Originally Posted by !@#$%!

oh, damn, i no longer have a subscription to that. copypasta, por favor?

Here you go

Markets are warming towards Jeremy Corbyn.

Yes, you read that right. In a sign of just how unpredictable UK markets have become, analysts are starting to believe that the diehard socialist leader of the Labour party could be just what sterling needs in this, its darkest hour.

The country is certainly putting investors through their paces with a series of political shocks and confusion, taken lately to a new level by plans for a general election and plans to suspend parliament. By comparison, the shake-up in UK markets when the 2010 election produced a hung parliament now looks like a twee outbreak of pearl-clutching.


“With the UK’s autumn political storm now breaking out in full force, this may prompt ‘peak uncertainty’ hopes . . . Investors might now look forward to the dust settling and knowing where we stand,” said Christopher Granville, managing director at TS Lombard. “The UK outlook is, instead, utterly imponderable.”

$1.20 has now become the new line in the sand for the pound, which pivoted around $1.60 for most of the post-financial crisis era. An alarming flash crash a few months after the Brexit referendum sent the pound very briefly under $1.15, but this week’s nadir — just under $1.20 — has not been familiar territory for sterling since Frankie Goes to Hollywood took Welcome to the Pleasuredome close to the top of the UK pop charts. (That was 1985, for those too forgetful or too young to recall.)

UK manufacturing data earlier this week suggested that a feeble currency is doing little to lift the economy. So, how could Mr Corbyn help?

To the extent that markets paid attention to UK politics over the bulk of the past two decades before the Brexit vote, the mantra has always, crudely, been “Tories Good, Labour Bad”.

“The markets wouldn’t be keen,” noted Capital Economics’ Paul Dales, “but if Labour came to power before the 31 October or after another Brexit delay, its opposition to a no-deal Brexit would remove a near-term downside risk to the economy. And, by removing further uncertainty, its support for either a softer Brexit or no Brexit at all would boost the economy in the medium term.”

Oliver Harvey, a forex strategist at Deutsche Bank, broadly agrees. “Some market participants have expressed concerns that the election of . . . Corbyn as prime minister could be negative for UK asset prices, particularly sterling,” he said. “We believe these fears could be overstated.”

Whatever the long-term implications for sterling, an ascent to power for Mr Corbyn would likely mean “the pound would benefit if the risk of a no-deal Brexit is removed and a closer UK-EU relationship looks more likely,” said Mr Dales.

Already, the parliamentary drama that lines up the chance of a general election has helped to boost sterling from its lows. It climbed 0.8 per cent on Wednesday morning. New rules clearly apply.