U.K. Labour Party Secured a Landslide Win in 2024 Parliamentary Elections

July 5, 2024 4:37 am

Exit poll numbers have trickled in and are pointing to a landslide win for the Labour Party and the next U.K. Prime Minister Keir Starmer.

This would mean a massive loss for current Prime Minister Rishi Sunak’s Conservative party a.k.a. Tories, which has been in power for 14 years.

Labour is slated to have a massive majority of 410 out of the 650 seats in parliament while the Tories are projected to end up with only 131 seats. Meanwhile, the Liberal Democrats are poised to secure 61 seats and the right-win Reform U.K. party are likely to have 13 seats.

Interestingly enough, these results highlight a shift to a center-left support, unlike the rise in popularity of the far-right movement in France. Still, the outcomes reflect the Brits’ huge disappointment over the Conservatives’ leadership, which has been blamed for the cost of living crisis, Brexit fiascos, and years of political instability.

Market Reaction

British Pound vs. Major Currencies: 5-min

Overlay of GBP vs. Major Currencies Chart by TradingView

Overlay of GBP vs. Major Currencies Chart by TradingView

The U.K. parliamentary election official results did little to establish a general direction among GBP pairs, as market players had already pretty much priced in the results a few weeks back.

Still, there was a notable dip for majority of the pairs, particularly GBP/AUD and GBP/JPY, as exit polls confirmed that Labour was in for a big win. Analysts say that this outcome likely gives the green light for the Bank of England (BOE) to cut interest rates sooner rather than later, as the political party has been pushing for a pro-domestic economy agenda.

Meanwhile, Cable also took some hits but managed to level off pretty quickly, as traders didn’t seem inclined to keep USD positions open for too long, given the Fourth of July holiday and the upcoming NFP release.

A few hours later, GBP pairs stabilized and started to cruise sideways, with the U.K. currency still ending up slightly in the red, except against the Greenback.

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