(Bloomberg) -- Financial markets shouldn’t under-estimate the chances of the Conservatives retaining power at the next general election despite a significant poll lead for the opposition Labour Party, Prime Minister Rishi Sunak’s city minister said.
Keir Starmer’s Labour Party has enjoyed a double-digit polling advantage over the Tories for months, though the gap has narrowed since Sunak said he would scale back the government’s green agenda last week. Sunak must call a national vote by January 2025 at the latest.
Andrew Griffith said voters are understandably disgruntled because of the after-shocks of the coronavirus pandemic and the impact of the cost-of-living squeeze, but that his party is still the best choice to govern the country.
“Don’t write us off,” Griffith said at Bloomberg’s Market Forum: FX in Focus event in London on Thursday. “In market terms, we’re a bit over-sold and they’re a bit over-bought. Lots of people are undecided.”
Discussing the future of the City of London and financial services, Griffith said the UK has maintained strong relations with the EU and is working cooperatively on improving the sector.
He also suggested that even though Britain post-Brexit has the freedom to regulate differently from the EU, it’s unlikely to radically diverge from the European approach on financial services.
“You don’t want to diverge for divergence’s sake,” he said. “You don’t want to create more friction in something that didn’t exist, so stay at par if you can. But you can look selectively to improve things.” He cited the example of planned reforms to the MiFID II rules to will allow firms to re-bundle the cost of investment research and trading expenses.
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