The impact of the UK General Election on financial markets

The impact of the UK General Election on
financial markets
30th May 2017 by Richard Perry, Market Analyst
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Introduction
After having repeatedly suggested that she was not interested in asking the UK voters to give her a
mandate as Prime Minister, on 18th April Theresa May announced that there would be a General
Election on 8th June. The machinations of contemporary politics mean that so many key
announcements are leaked in advance, however this one took markets by complete surprise.
Despite this though, could it be that this is one of the most predictable general elections in living
memory?
We look at the key factors to be aware of during the campaigning, the polling, the key stances of
the major parties and what the outcome could be. We also analyse the major market reactions and
why we should still be concerned by the outcome for the UK’s snap 2017 General Election.

The impact of the UK General Election on financial markets
Why is the election being held now?
This can depend upon your political standpoint. Theresa May said that she wanted Westminster to not stand in
her way of Brexit negotiations and for that reason, she called an early election. Her opponents claim
opportunism with a disruptive and divided Labour Party, in addition to going back on her word. Furthermore,
critics also suggest that the part of Westminster standing in her way were actually the hard line Brexiteers on
her own backbenches.
Realistically the reasons are varied but are mainly for Mrs May to gain control over her party:
• The main threat to Mrs May is rebellion from the hard Tory right. With such a small working majority,
they are able to hold her to ransom on their demands over Brexit. This is what she is looking to change -
to dilute the strength of the hard Tory right in Parliament. The hard-line euro sceptics amongst the
Conservative MPs are likely to have their influence diluted if Theresa May can secure a larger majority.
• The Labour Party has been unable to provide an effective and coherent opposition in the last two years.
The chaotic view of Jeremy Corbyn’s Labour and with opinion polls strongly in her favour means that
the timing is right. Mrs May believes that this is the time to increase her majority.
• The timing also comes early enough in the Brexit negotiations so as not to disrupt them. There will be
little real progress made until the German election has been held on 24th September, meaning a UK
General Election in June makes sense.
• Winning an election gives her a “mandate”, but this is something that commentators who
misunderstand our parliamentary democracy put too much weighting on. A “mandate” is not the primary
reason.
Winning an increased majority means that Mrs May can go into Brexit negotiations without having to look over
her shoulder. She can negotiate on her terms and I believe reduces the likelihood of a dramatic walking away
from the negotiations without a deal from the EU. Theresa May was a former pro-Remain campaigner (or at
least publicly) and her real stance is likely to be for more of a “soft Brexit”. She would just like the space to
negotiate that way. That is why the election is being held now..
What are the potential winning parties offering?
Only two people could potentially be Prime Minister after the results have been counted, Theresa May and
Jeremy Corbyn. What are their parties offering as key policies and how to pay for them?
Labour Party
Labour has announced what is the most left wing manifesto since 1983, driving what would be a huge
ideological shift in the size of the state in the UK economy. This has Jeremy Corbyn’s socialist ideology
stamped all over it and whilst Labour stopped short of the withdrawal from NATO or nuclear disarmament, this
was not a million miles short. A manifesto to stop the “rich getting richer” is as populist as it is anti-aspirational.
Plans to nationalise the railways, the power grid, the water companies and the Royal Mail represent a
significant lurch to the left and pulling Britain back to the politics of the 1970s.
However, there will be much that people will find appealing in this manifesto, especially on the spending
commitments.
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Labour’s spending pledges (so called “current spending”) of around £49bn include:
• An extra £5bn spending into the NHS
• £25bn on education (which includes £6.3bn per year on schools, £5.3bn on extra childcare and around
£11bn on scrapping university tuition fees).
In isolation, many of the policies seem to have popular backing, but when added up to a manifesto it all
needs to be paid for. Whilst the Labour faithful, many of whom are extremely vocal on social media, would love
the way they are proposing paying for these spending commitments, “Middle England” may not be so sure.
Labour’s tax increases are targeting the “better off” (£80,000 per year is hardly rich in contemporary Britain),
and corporations (anti-business). Tax increases that target success stifle aspiration. Furthermore, the total tax
burden would rise to the highest level since the 1940s.
This is all before considering a huge (as yet) unfunded commitment to nationalisation. The market
capitalisation of National Grid alone comes to around £40bn, so where will this money come from? There is
also a £250bn “National Transformation Fund” of proposed infrastructure spending (paid from borrowing)
spread over ten years. This would increase borrowing by £25bn per year.
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Major tax changes
Corporation tax raising to 26% (from 19%) by 2022 – supposedly to raise £19.4bn
Income tax – The old 45% rate tax band on earnings over £150,000 will be reduced to £80,000,
whilst there will also be a new 50% tax band at £123,000. Labour claims the changes are
expected to raise £6.4bn.
Labour’s Tax Avoidance programme would also look to raise £6.5bn.
Reversing “tax giveaways” on Capital Gains Tax and Inheritance tax, a bank levy and removal
of the married persons’ tax allowance is expected to raise £3.7bn.
Financial Transactions Tax – Perhaps most interesting for financial markets seems to be
Labour’s proposed tax changes, (dubbed the “Robin Hood Tax”) of up to 0.5% per transaction
on derivatives. Furthermore, Labour would remove the stamp duty exemption currently enjoyed
by market makers and “intermediaries” such as hedge funds. This is expected to raise £5.6bn.
Executive Pay Levy – on companies paying remuneration packages over £330,000 would be
2.5% raising to 5% on remuneration above £500,000 is expected to raise £1.3bn

The spending plans sound fantastic, but have to be paid for, and the taxation assumptions are already being
picked apart. The IFS believe that the income tax changes could add perhaps £2bn to £3bn, around half of
Labour’s expectation, whilst Corporation tax changes take no account of the reduced investment that could
result, hitting the economy in different ways. Failure to raise the taxes to meet the “current spending” would
mean either further tax increases or more borrowing.
Just as the UK is moving towards Brexit, the Labour Party has put forward a manifesto that is going to deeply
concern any overseas companies looking towards making inward investment in the UK. Furthermore, the
section of the electorate casting their vote along Brexit lines would have been interested to see no immigration
target and also a decision that whilst Labour would honour the EU referendum decision, they would not leave
the negotiation table without a trade deal. Quite how that would help the success of the Brexit negotiations
remains to be seen. This gives the EU a huge boost going into the negotiations with a Labour
government, knowing that they have to accept any deal offered, no matter what it finally is. It is the poker
equivalent of Labour playing a completely open hand.
Conservative Party
Theresa May said that she would launch “my manifesto” as she aimed to get the Conservatives re-elected. It is
interesting that Mrs May has chosen to focus the election on herself. At the manifesto launch there was a
tiny logo and a notable absence of “real people” giving eulogical introductions (although it is unconfirmed that
this is because they could not find any “real people” willing to publically do so).
The Conservative manifesto is less dogmatic than Labour’s, more attuned to the business of running a country.
Labour went into the minutia of detail with precise costings, however the Tories have felt perfectly content to
be far more broad-brushed with precious little detail of how it will be paid. Instead, the Tories tend to
argue that they can pay for their policies through economic strength. Being significantly behind in the polls,
Labour went for a massive tax-and-spend manifesto aimed at punishing the rich and redistributing the wealth.
The Tories have gone for steady-as-she-goes.
Seemingly having got the right wing vote already tied up in blue ribbons, the Tory manifesto is aiming
squarely at the centre ground, with some even suggesting that it is the Tory Party’s own lurch to the left.
However, could they be at risk of alienating some of their core vote in an attempt to target a section of the
electorate that would never vote Tory anyway? Accusations of Theresa May being “red-Tory” are sure to fly.
Fiscally there is a commitment now to not balance the budget deficit until 2025. This confirms a move away
from the George Osborne-style austerity with looser purse strings. Broadly the manifesto focuses dealing with
social care, funding education, and yet another ridiculous immigration target. Furthermore, in a lean to the
centre ground, the Tories would be cracking down on big corporations with worker representation on boards
and the ability to intervene in foreign takeovers (has possible equity market implications).
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However, having originally looked to focus on this being a Brexit election, the Tories seem to have
(temporarily at least) lost control of the agenda. They have inexplicably allowed their controversial social
care plans to take front and centre. This is with a view to getting older people to contribute more to their social
care in an attempt to take the burden off the tax payer. Effectively though, the real issue is one of who pays for
the UK’s ageing population, the tax payer or themselves?
Perhaps this is a calculated gamble, however could it dramatically backfire? The baby boomer generation have
historically supported the Tories, but the Conservatives intend to take the onus of social care off the state and
on to the user. This could be seen as turning against their core support demographic. There has been a
notable backlash in the polls and it will be interesting to see if this has a lasting legacy on the result.
The Tories have moved to mitigate the more politically toxic parts of the policy and performed a U-turn to
include a cap on the total amount people pay. This should be enough to save them from a calamitous defeat
from the jaws of victory, but the handling of the issue smacks of inexperience and/or complacency, neither of
which are especially encouraging.
As for immigration, the commitment (yet again) to get the net migration numbers below 100,000 (for a third
election in a row) seems to be somewhat of a tall order. According to the Office of National Statistics,
immigration may have dropped by 84,000 in 2016 to 248,000 but there is still a significant way to go before a
drop below 1000,000 is seen. The immigration cap is aimed at securing the blue collar traditional Labour voters
who are concerned over Labour’s uncertainty over Brexit. It is the big contradiction that the Tories are now
bound to and is a circle they will forever be unable to square. Immigration is ultimately needed to combat
the negative economic impact of an ageing population, however the finite space of the country (and finite fiscal
resources) means that immigration is a big issue for the electorate.
As for Brexit, the Conservatives have said there will be no single market and no customs union. There will be
“no vast payments” to the EU with regards to the UK’s divorce settlement. The Tories have also kept open
the prospect of walking away from negotiations should the deal on the table be considered to be a “bad
one”.
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Conservative manifesto highlights
NHS – a real terms increase of £8bn per year by 2022/2023
Taxation – the personal allowance to be increased to £12,500, whilst the higher rate
tax threshold (on the 40% bracket) increased to £50,000
Corporation tax to fall to 17% by 2020 (this is just a confirmation)
Pensions – a change to a “double lock”. This is to replace the “triple lock”, with the
Tories removing the guarantee for at least +2.5% rise in pensions, focusing just on the
higher of average earnings or inflation
Education – increase spending by £4bn per year. This will be contributed to by flipping
the meal provision through the removal of free school lunches for infants in England
and replaced by free breakfasts for primary schools (up to eleven years old).
There would also be an increase from £1000 to £2000 on the amount levied on
companies employing non-EU migrant workers.

What are the opinion polls saying?
As at the weekend of 27th May, the polls were strongly in favour of the Conservatives. However, the recent pick
up in support for Labour seems to be coming at the expense of the smaller parties. UKIP has suffered
especially.
.
Source: Britain Elects Poll of Polls
The expectation of number of seats has been stronger for the Conservatives and it seems as though they have
not had the best of campaigns so far. The seats poll tracker suggests that they have shed potentially around 50
seats since the campaign began.
Source: Britain Decides Poll Tracker
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The table reflecting the change in voting intentions and seats since the 2015 election show the Conservatives
making strong gains.
*Data from Britain Elects poll of polls, 27th May, not including the nationalist/regional parties
**Data from Britain Decides Poll Tracker 26th May
From the polls and seat projections the main factors to watch in driving this result are:
• The long term switch in support from UKIP to Conservatives
• Labour’s failure to significantly recover lost ground
• Only a negligible rebound by the Liberal Democrats
• Latterly the positive impact of the Labour manifesto
The political winners and the losers
According to the opinion polls, the Conservatives are still on course for a significant victory on the 8th June.
This comes amid an expectation that former UKIP voters are switching to the Tories. With Brexit now a reality, it
looks as though UKIP is at risk of almost becoming an irrelevance in UK politics. Furthermore, the Labour vote
has struggled again as Jeremy Corbyn has dragged the party as far left as it has been for more than a
generation. It has been said that Jeremy Corbyn would merely be happy if the Labour Party polled better than
Ed Miliband’s 31% in 2015. This is a sad state of affairs for the Labour Party if that is indeed true.
The projected vote for Labour is expected to marginally pick up from its 30.8% from 2015. To be fair, this is far
better than the outlook just a few weeks ago. Despite this though there has been a failure to make any
significant inroads into the Conservative lead which has been unerring since the 2015 election. Labour could
still challenge the nadir of their popularity from the 1983 election which was perceived as shambolic for Labour.
That was the last time that Labour swung so far to the left in their manifesto and they won 209 seats. According
to Britain Elects, Labour is still on course to all but match this nadir, projected to win just 210 seats.
The Liberal Democrats saw their representation decimated in the last election as they were punished for their
part in a Conservative coalition government, however this does not seem to be significantly recovering. It is
though surprising that the number of seats they win is currently projected to be similar to the 2015 election.
Finally, it looks like this could be a difficult election for the Scottish Nationalist Party (SNP). Their vote could
almost become a referendum on Brexit in itself. The SNP have been positioning and subsequently pushing for a
second independence referendum ever since Britain voted for Brexit. Their argument has been that 62% of
Scots voted to Remain. However, if this election becomes all about Brexit then the 38% that voted to leave will
have a real decision to make. This could be to the detriment of the SNP. Winning 56 of the 59 seats available in
Scotland in the 2015 General Election means that it becomes very difficult to better that. Any drawdown on its
seats in this election will be leapt upon by the unionist parties as a rejection of a second referendum.
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Thoughts on the UK General Election
Labour has really gone for the populist vote. Looking to smash aspiration is a classic hard left tactic. Britain
rejected a mild push to the left under former leader Ed Miliband in 2015, yet Jeremy Corbyn is attempting to
bring his anti-establishment protest politics into the main stream. Will there have been such a seismic shift in
voting tendencies in just two years? It is my feeling that Brexit will play more of a role in this election than
Corbyn is anticipating. The stance of a deal at any cost may not go down well with an electorate that now wants
Brexit to be done.
The Conservatives have again been significantly underwhelming in this election, yet seem ready to win
almost by default. They seem once more unwilling or unable to provide the UK with a positive vision to drive
post-Brexit economic prosperity. In the face of a by a divided Labour Party, they need to provide Britain that is
prepared to face Brexit firing on all cylinders. This is sadly not the case. One can only hope that immigration
caps prove to be empty rhetoric, as with an ageing population, the economics add up to a serious lack of tax
receipts and reduced growth potential.
The likely result – an increased Tory majority, but by how much?
Opinion pollsters had something of an annus horribilis in 2016. They failed to call the Brexit vote and they failed
to predict the US Presidential vote. However, that might be doing them a disservice. Brexit was becoming
increasingly tight in the weeks running up to the vote, as was the US election. Furthermore, Hillary Clinton did
end up winning the national vote, it was the Electoral College system that defeated her. Now in 2017, the Dutch
election was well called by the polls, whilst both rounds of the French election were also very close to how the
opinion polls had called them.
Ever since the UK election was called on 18th April, pollsters, betting companies and markets alike have been
nailing on a Conservative victory. Whilst this is still highly likely, the hugely populist Labour manifesto has had a
sizeable impact on the polls. Furthermore, it seems that the issues over Social Care in the Conservative
manifesto have not helped their prospects.
In the three weeks up to 27th May, Labour had announced their manifesto and subsequently added 4% to their
polling. Furthermore, there are increasing signs that support for the Conservatives could be on the wane. The
swing back to Labour has pegged the projected seats won for the Tories back to 360 (down 33 from the 393
from 8th May) and Labour’s seats have jumped to 218 (+37 from 181 on 8th May). If this trend continues then
the result could be far tighter than commentators have previously thought. Despite this though, the
Conservatives still seem set for an increased majority, it is just that it may not be as large as once thought.
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THE MARKET IMPACT
General Impact
Markets initially seemed to be paying little attention to the prospect of a Labour victory. However, if reaction to
the tightening of the polls is anything to go by then the election is still an issue for the markets. A
populist surge is arising from the Labour manifesto and is clearly impacting, especially on sterling and the UK
Gilt yield curve.
However, history would suggest that the closer we get to polling day, the better the Tories tend to do. If
Labour is not within touching distance by now, the market is right in hardly bothering to give them a chance.
Even given with a recent tightening, the latest opinion polls still show a solid Tory victory is on the cards.
However, there are two weeks to go and anything could still happen, but the markets are pricing on how big the
margin of victory will be for the Conservatives, rather than whether they will win at all.
Sterling
Sterling strengthened following the surprise announcement from Theresa May on 18th April. On that day alone,
Sterling/Dollar bounced around 3%. However, the announcement of the two main parties’ manifestos has
latterly led to a tightening in the polls, with Sterling latterly starting to underperform major forex currencies.
A tightening of the polls would certainly pare the gains on sterling.
This is for two reasons:
• Labour’s policies are anti-aspirational, anti-business, growth-negating and be sterling negative.
• Corbyn’s Labour is seemingly willing to roll over on the Brexit negotiations.
Cable broke above a key resistance at $1.2775 in the wake of Theresa May’s surprise announcement of the
election. This seems to have been a significant watershed breakout for sterling. It is a level that will probably
now gauge the market’s perception of “success” in what is still likely to be a Conservative victory.
Sterling underperformance since the polls started to tighten suggests that traders will be watching the polls and
trade accordingly in the final weeks of the campaign. Tighter polls will drive sterling underperformance.
Scenarios:
• An improved Conservative majority to over 80 seats would be sterling positive. This would drive
Cable consistently above $1.3000 and potentially push towards $1.3500 (especially if dollar weakness
continues). It would also pull EUR/GBP back towards £0.8300. A significant Tory majority is becoming
less likely as the campaign rolls on, however it is still possible. PROBABILITY: c. 40%
• A mild improvement in the Tory majority to around 50 seats would be largely market neutral.
GBP/USD would continue in its range between $1.2775 to $1.3050. EUR/GBP would also likely be
around £0.8600. As the polls tighten, the likelihood of this has increased and is now the most likely
scenario. PROBABILITY: c. 70%
• No change in the Conservative majority would see sterling unwind recent gains. This would drag
GBP/USD back towards $1.2400/$1.2600, which is where it traded prior to the announcement of the
election. The recent strength of the euro means that EUR/GBP would likely test the £0.8850 January
high. PROBABILITY: c. 40%
• A hung Parliament would be unexpected and be sterling negative. With huge political uncertainty
there would be a case for sterling to fall back into the $1.2000/$1.2200 region against the dollar, whilst
EUR/GBP would likely push well above £0.9000. There would need to be a significant deterioration in
support for the Conservatives for this scenario to be seen. PROBABILITY: c. 10%
• A Labour victory would be enormously unexpected but also interestingly could be sterling
supportive. The political uncertainty and anti-growth policies of Labour would be sterling negative, but
the “soft Brexit” of Labour could also put a floor under sterling. Volatility would be high as the market
tries to work out the implications. Initially testing $1.2000 against the dollar could be a chance to buy.
EUR/GBP over £0.9200 could be a selling opportunity. PROBABILITY: c. 1%
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UK Gilts
The yield curve has made two moves since Theresa May called the election on 18th April:
• Initially STEEPENING – this could be that the Tories are considered to be stronger for economic
prospects, driving up the longer end of the yield curve.
• Subsequently FLATTENING – in the wake of the respective manifestos which have significantly
tightened the polls, market suddenly seems to be worried about Labour performing well. Labour’s
manifesto seems to be perceived by the markets as economically very concerning. This has driven a
significant flattening in the longer end of the yield curve.
A complicating factor is that there has been a Bank of England meeting since then (which was somewhat
dovish), whilst CPI inflation has also picked up strongly. These factors would have played a role in this
steepening the curve by dampening yields at the short end, whilst increasing them at the long end. It is difficult
to determine whether the steepening is due to confidence in future expectations on inflation or economic
growth. However, the flattening since Labour’s manifesto on 16th May has been undeniable.
Could it be that the markets are now questioning a Conservative victory? This remains unlikely, but as the polls
tighten the prospect of an election that results in little increase in the majority for the Conservatives is growing.
This also shows that the polls are having an impact on the yield curve and need to be watched in the final
weeks of the campaign.
FTSE 100
The FTSE 100 recently broke out to all-time highs. Whilst clearly there are other exogenous factors (Macron’s
victory strengthening risk appetite, whilst a commodities recovery also helped to drive a resources-heavy FTSE
100 higher), it is interesting to see the move has come as sterling has also strengthened. The negative
correlation of sterling to the FTSE 100 has been an interesting trade on several occasions since Brexit.
However this relationship has deteriorated since Mrs May called the election on 18th April.
With over 70% of FTSE 100 earnings in foreign currencies, the sterling weakness has been positive for FTSE
100. However, since 18th April, this correlation has flipped and become positive again. This means that either
the exogenous factors that are outweighing the impact of the currency, or equities are taking the prospect of a
larger majority for the Conservatives as a positive for both sterling and UK equities. This would be the normal
reaction in any given UK general election. It is though interesting to see that as sterling has started to decline
with the polls tightening, the FTSE 100 negative correlation has shown signs of returning.
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The chart below also shows how the FTSE 100 continues to perform strongly in sterling terms since Brexit.
However, much of this performance seems to be down to the weakness of sterling. Investors from overseas
trading either in dollar or euros continue to only see minimal returns on their UK equities.
.
2
Daily GBP=, .FTSE 25/03/2016 - 12/06/2017 (GMT)
GBP/USD
Theresa May calls the election
Price
USD
Auto
1.24
1.28
1.32
1.36
1.4
1.44
1.3010
FTSE 100
Price
GBP
Auto
6,000
6,300
6,600
6,900
7,200
7,469.19
0Correlation (60 days)
Value
USD
Auto
-0.3
0
0.3
0.857
01 18 02 16 01 16 01 18 01 16 01 16 03 17 01 16 01 16 02 16 01 16 01 16 03 17 01 16 01
Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sep 16 Oct 16 Nov 16 Dec 16 Jan 17 Feb 17 Mar 17 Apr 17 May 17

Others – Gold, Euro, DAX
With the incumbent Conservatives set to retain power, it is difficult to see that the UK election will have too
much political risk for assets outside the UK. Political risk has been the preserve of the Eurozone countries’
elections in 2017. The euro bulls especially gave a huge sigh of relief after the anti-euro, anti-EU Le Pen victory
failed to materialise in France. However, when considering the UK election, traders would be more interested in
looking ahead and planning for the longer term implications of political risk in the Italian election that will be held
within the next twelve months. Subsequently there is little impact expected on the gold price.
Both Conservatives and Labour are signed up to delivering on Brexit, so the political risk has already been
baked in. This means that there is little real political risk that would impact on Gold or the Euro on varying
results of the UK election. EUR/GBP cross would have an impact from the movement on sterling, however any
knock-on impact on other euro crosses is likely to be limited.
As for the DAX, although the market itself is unlikely to be significantly impacted by the UK election, there could
be some individual companies with elevated volatility. German exporters into the UK could be impacted,
however this would more likely be a slow burn over the coming months (and possibly years) of the Brexit
negotiations. This would be driven by newsflow over trade agreements and potential return to WTO rules. The
EU tariff on cars is currently 10%, so car exporters such as BMW and Volkswagen would certainly feel the
pinch of a “hard Brexit” of no EU trade agreement. However we will not know how that will pan out for several
months after the election.
And a few final thoughts on the impact on Brexit
The stance of European Commission President Jean-Claude Junker’s has seemingly set out an EU that is
contemptuous of the UK government’s attempt to negotiate a “successful” Brexit. Given that Theresa May is
almost certainly going to be prime minister after the 8th June, the issue would be how strong a government she
would lead and how this positions her moving into the negotiations.
After a series of leaks seemingly aimed at discrediting the UK Government, which was described by an EU
diplomat as being “in a different galaxy”, Theresa May has hit back by suggesting that she would be a “bloody
difficult woman” in dealing with Junker for the negotiations. If Theresa May has a strong majority in the House
of Commons, it would mean that she would have a significant mandate for the Brexit talks. She could negotiate
on her terms and it would mean that the outspoken Brexiteers in her party would have their voices diluted.
Currently with a working majority 17, this means that if the Brexiteers were unhappy with Mrs May’s negotiating
stance, they would be able to give her a bloody nose by voting against her. However, with an extended
majority, say between 80 to 100 seats, this would mean that these Brexiteers would have less influence. Our
belief is that this would lead to less hard-line tactics and less likelihood of walking away without a deal from the
Brexit negotiating table.
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Looking at the reaction of sterling on the Cable chart in response to Mrs May calling the election, this is what
the markets believe too. The prospects of sterling over the past year have often been determined by how “hard”
or “soft” a Brexit that the UK is likely to walk away with. A softer Brexit has driven sterling recoveries. After
Mrs May announced the election on 18th April, sterling rallied around 3% against the dollar, suggesting that
markets support the move.
Latterly we have seen Emmanuel Macron winning the French Presidency and his victory could go both ways for
Theresa May. Macron is a Europhile and has previously been scathing of Britain’s decision to leave the EU.
Perhaps this puts him in the “bloody difficult” category too. However there is also an argument to say that
Macron’s victory continues a run of defeats for the populists (Austria, The Netherlands and now France) and
helps to stabilise the EU. An EU less at risk of breaking up could react more favourably to the UK than a
wounded animal fretting over its potential demise under a Frexit-leaning Le Pen.
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