A positive YouGov opinion poll for the Conservatives sent the pound up to its highest level since the spring yesterday. This was despite mixed results for jobs and wages. Average wages in the UK rose by 3.6% (a little less than expected, but a rise nonetheless) and unemployment fell again. But the rate of job growth has slowed, suggesting a slowing down economy.
The currency markets certainly seem to be favouring a Conservative victory, but the biggest majority at the moment seems to be for confusion. For example, reading down into the detail, in the same YouGov poll conducted last weekend, that showed increased support for the Conservatives and sent the pound shooting up, people were asked (see page 14) if they wanted “to retain the right for EU citizens and British citizens to live and work in each others’ countries”. And 67% said they wanted freedom of movement to continue, against only 15% who said they wanted it to end!
Given that ending free movement was a key plank of the Brexit campaign, and the Conservative’s policy, this seems counter-intuitive.
Even among those who voted to Leave in 2016, 54% said they wanted freedom of movement to continue, and just 24% for it to end (the rest being ‘don’t knows’). The electorate don’t seem to know what they want.
Still, for those of us wishing to move or buy abroad, this suggests that in the final deal to be negotiated over the next year – assuming the Tories win a clear majority, which of course we can’t – freedom of movement won’t be the red line that we thought it might be. An easy visa system or continued freedom of movement could be the result.
But a lot of water will be flowing under the bridge before then, especially if you’re in the north of England, and the pound could go literally anywhere in the next four weeks.
Please don’t leave your dreams of living abroad to be carried away in the deluge if the pound moves against you after the result on 13th December. Lock in your rate today with a forward contract. Call your trader on 020 7898 0541.
