Following several weeks of voting, Boris Johnson has won the Conservative Leadership contest, and will tomorrow formally become the Prime Minister of Great Britain and Northern Ireland.
Johnson was seen as the clear favourite to replace Theresa May ever since she announced her resignation back in May, and dominated the MP-only votes. The ballot of 160,000 Tory party members evidently agreed with MPs, and Johnson secured ------ votes compared to just ----- for rival Jeremy Hunt.
The choice is not without controversy; several key cabinet ministers – including chancellor Philip Hammond – have made it clear that they will not serve under Johnson. Sir Alan Duncan resigned yesterday morning, and called for a no confidence vote ahead of any Johnson government being formed.
The victory will be seen as a triumph for Boris, considering past accusations of infidelity, as well as more recent investigations into a domestic argument with girlfriend Carrie Symonds – the former Director of Communications for the Conservative Party.
Johnson has a “do or die” attitude towards the October 31st deadline for Brexit. This willingness to accept a no-deal Brexit is a sore point for many MPs, including many within the Conservative Party. The new PM could face a vote of no confidence across the House, and rebels within the Tory party – rumoured to be led by Dominic Raab – may desert him.
Despite Boris’ assertions that a new Brexit deal can be negotiated, many in Europe have firmly repeated that the new PM will receive the same offer as Theresa May and nothing else. This makes investors nervous that no-deal is the most likely outcome, and the Pound has already suffered; losing 5% against the US Dollar since Theresa May announced her resignation. As the October deadline approaches, investors will be looking very closely to see how negotiations are progressing, if at all. Businesses and financial institutions have warned of the impact a no-deal Brexit would have, with some claiming the UK economy will likely slip into recession.
Gold and silver have both experienced improved demand due to the uncertainty, gaining an impressive 16.43% and 14.13% respectively in the past three months. If October approaches and no-deal looks like the probable outcome, a weak pound is almost inevitable. Demand will be the true driver of price, and safe-haven buying could see both metals make significant gains.