he pound has been dragged lower by lingering concerns regarding the possibility of a hung parliament at the upcoming general election. A poll released from ICM Research showing just a 7% advantage for the Tory Party has got the market jittery and not entirely convinced that a Conservative Party majority is a foregone conclusion.

While Johnson continues to enjoy a double digit lead in the poll of polls, concerns centre around whether this will be enough to translate into the 326 seats he requires for a 50% share of the seats in the House of Commons. Not only could a hung parliament delay the Brexit process, but it would also markedly increase the chances of a ‘no deal’ Brexit later down the line.

A key moment for the UK currency will come in the form of YouGov’s MRP estimate at 22:00 GMT this evening. The MRP is a statistical method that translates national opinion surveys into local estimates, designed to predict a narrow range of how many overall seats each party will obtain in the election.

While of course not an exact science, it should give a decent indication as to the most likely outcome of the vote. It is worth noting that the MRP estimate from the 2017 election proved accurate, particularly as far as the number of Labour seats were concerned, so investors will be paying close attention to its release later today.

EUR/USD trades in tight range ahead of US data dump

A dump of US data out this afternoon will focus the minds of investors ahead of the Thanksgiving holiday on Thursday.

Revised Q3 GDP numbers, personal spending and income figures and durable goods orders will all be worth keeping tabs on and could shift the greenback today. We will also be paying close attention to the PCE price index, the Fed’s preferred measure of price growth, for an indication as to whether there are any inflationary pressures present in the US economy.

As mentioned yesterday, this week is a quiet one in terms of Eurozone data until Thursday, when we will receive the latest German inflation numbers and Euro Area wide confidence indices. Ahead of these releases, EUR/USD continues to potter along in a fairly narrow range around the 1.10 level.

Emerging markets buoyed by Trump trade comments

Optimism surrounding the US-Sino trade war has also buffeted the FX market in the past 24 hours or so. According to President Trump the two countries are in the ‘final throes’ of negotiations over the ‘phase 1’ trade deal.

This has unsurprisingly boosted emerging market currencies, while triggering a sell-off in the safe-haven Japanese yen. The market has, however, been stung on numerous occasions by Trump in the past, with his upbeat comments often followed soon after by additional protectionist rhetoric. We’ll likely have to wait until the weekend at the very earliest for any firm indications that a deal is close.