The clear majority won by the Conservative Party in December’s general election has led sterling and UK risk assets to rally sharply in response to the removal of near-term policy uncertainty around Brexit.
This means the UK will likely leave the European Union on 31 January 2020 under Boris Johnson's existing withdrawal agreement. There is still a chance of an extended transition - although not beyond December 2020 according to the Conservative manifesto - but the Commons majority should provide Johnson with useful flexibility to negotiate either way. The extent of the Labour Party's plans for greater nationalisation, higher corporation taxes, and public spending were an additional source of anxiety for markets, and the removal of this potential tail risk should help make the UK investable...
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