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Necessity hath no law

| Posted by: Paul Donovan | Tags: Paul Donovan

  • UK Prime Minister May will today tell Parliament 'In the name of God, go' and ask for a June election. Those ever-reliable barometers, the opinion polls, give the governing Conservatives a‎round about a 20% lead over the opposition. 
  • For investors, there are subtleties in the vote that may matter much. A larger majority would strengthen May's personal position. The Salisbury Convention means that the prospect of blocking mechanisms from the House of Lords is significantly reduced. 
  • In the calmer world of economics, the US Fed's Beige Book of 'anecdotal evidence' (gossip for economists) is due. With seasonal adjustment reducing confidence in Q1 data reliability, this may take on greater importance. ‎Reported inflation pressures will also be free of the technical changes that lowered consumer price data last week. 
  • Euro area consumer prices are not likely to get investors excited. In geopolitics, last week's rising tensions between the nuclear powers of the US and North Korea were based on fake news. The US 'armada' did not sail to Korea, but headed towards Australia (presumably without hostile intentions). It is now heading north.