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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
UK
Political betting markets show Prime Minister Boris Johnson's centre-right Conservatives as likely to lose both parliamentary by-elections taking place this Thursday 23 June. Data from Smarkets shows a 98% implied probability that the centre-left Labour Party wins the northern English seat of Wakefield from the Conservatives, while the centrist Liberal Democrats are given a 76.9% implied probability of taking Tiverton and Honiton in southwest England from Johnson's party.
- The seats holding by-elections (both due to scandals involving incumbent Conservative MPs) are seen as representative of two very different but equally important sections of the Conservative Party.
- Wakefield sits as part of the 'red wall' of seats in the post-industrial north that up until the 2019 election had been held by Labour for decades. Its voters are seen as strongly supportive of gov't spending and the 'leveling-up' agenda of investment promised by Johnson ahead of the 2019 vote, allowing the Conservatives to take the seat with a majority of just over 3k.
- Tiverton and Honiton in south-west England has had a Conservative MP since its creation in 1997, and before then since the creation of Honiton constituency in 1885. A largely rural seat, it had a Conservative majority of over 24k votes in 2019. Its voters are seen as more 'traditional' Conservatives, backing a smaller state and gov't support for farming and agriculture.
- The likely loss of both of these seats will set alarm bells ringing not only for 'red wall' MPs with narrow majorities, but those Conservative MPs with large majorities in so-called 'blue wall' seats being targeted by the Liberal Democrats. PM Johnson narrowly survived confidence vote in early June, but poor results on 23 June could heap pressure back on the embattled leader.
- Should be noted that by-elections often result in a loss for the governing party mid-cycle, and that the Liberal Democrats in particular are anecdotally known for effective campaigning when focusing on one seat, but struggling in national campaigns around general elections.
Chart 1. Betting Markets Implied Probability of Winning Tiverton and Honiton By-Election, %
Source: Smarkets
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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