00:00Welcome back to Bloomberg Daybreak Europe. Andy Burnham, the UK's presumptive next prime minister, is yet to name his chancellor.
00:06But among the potential candidates, the Energy Secretary, Ed Miliband, is seen as the least market-friendly choice.
00:12That's according to the latest Bloomberg Markets Live Pulse survey.
00:16Let's get more with Morwena Konium, the co-editor of Bloomberg Markets today.
00:21So we know who the least sort of friendly to the market is going to be. Who would be the
00:25most friendly?
00:28The most friendly is expected to be Wes Streeting, with over 30% of votes in our survey.
00:35I think that's not a huge surprise. He is known to be a lot more centrist in his views.
00:40Ed Miliband is sort of associated with higher spending plans and potentially therefore higher taxes.
00:49But the market is very much saying Ed Miliband first and then, I'm sorry, Ed Miliband last, but Wes Streeting,
00:57you know, coming out on top by quite a wide margin over the other candidates who we, you know, put
01:04forward as likely options.
01:06Darren Jones, you know, coming in quite weak as well.
01:10John Healy, the former Defence Secretary, coming in quite a way behind, but the next best considered after Wes Streeting.
01:18But lots of people actually chose someone else and put in a suggestion of their choice as well, where that
01:25was 16% of votes.
01:26So there's certainly a lot of variety in people's thoughts, and I don't think there's a certainty there at all.
01:37And more broadly, how is the market and how are sort of the market viewing the effect of a Burnham
01:42in sort of 10 Downing Street on broader UK assets?
01:48Yeah, so overall, market participants do expect Burnham's premiership to have a potentially negative impact on UK assets.
01:59About 40% of the respondents said that it would make them more bearish on UK assets.
02:06And about another third were already bearish, and they said it wouldn't make any difference to their opinion.
02:11And that was a lot more than those who said it would make them more bullish.
02:15And I think when we look at the individual assets, you know, they do see gilt yields rising slightly to
02:20an average of 10-year gilt yields about 5%.
02:23And they see, you know, the pound on average coming back to about $1.30.
02:30But there was quite a wide range of variety in the responses.
02:35And these aren't, you know, huge moves.
02:37I think what really is the strongest takeaways from this survey is that overall a bearish attitude to assets and
02:45the fact that there are quite strong opinions on who would make the best chancellor.
02:50And I think a lot is riding on that because there is a lot unknown actually at the moment about
02:54Burnham's economic policies and what he'll do.
02:58So I think really markets are waiting to find out who the chancellor will be, particularly, you know, we've actually
03:05seen a steady period for gilt through all this until now.
03:09Yeah, and very quickly, you've also put a question about expanding potentially the BOE's remit to beyond inflation and price
03:15stability, but also to growth.
03:17What did you learn from that?
03:19Yes, so actually the suggestion that has come from Burnham's camp about expanding the Bank of England's remit
03:27to include growth as well as inflation, you know, while the idea of sort of higher growth policies that might
03:37come from Miliband weren't very popular,
03:40this particular policy did seem to strike a chord with market participants.
03:44And they were broadly in favour of that, which I think is quite important, particularly as we look forward to
03:53the central bank
03:55and what they're going to do the rest of this year.
03:57The market has been quite fluid on that and the moment still pricing in one interest rate hike by the
04:04end of the year.
04:05But, you know, the situation is fluid and, you know, perhaps a lot of market participants expect them to keep
04:12rates on hold.
04:13So I think it'll be quite interesting to see what they do.
04:16And of course, if their remit was to change, then that would, you know,
04:20make their job potentially more challenging, but also potentially easier, depending on what their focus is.
04:26They've talked a lot about growth recently.
04:27Andás arrivé withانas
04:28And of course, if they're stretching the point, I think there's a lot of people who have to...
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