The GBP headed for the fourth month of gains against the euro gains; fuel on election poll

The GBP headed for the fourth month of gains against the euro, reflecting the growing confidence in the markets that the Conservative Party will secure a majority in the UK Dec election.

The GBP outperformed all major currencies after the much-anticipated poll released on Wednesday evening. The survey suggested that Boris' party was on track to win its most significant mandate since the 1980s.

It's the best scenario for investors betting on the GBP as it could end the political impasse over Brexit.

According to the YouGov poll, Conservatives are on course to win a vast majority of 68 seats in the Dec 12 election. The poll used a technique that more closely predicted the 2017 election than the standard surveys.

The win would allow Boris to get his Brexit through Parliament by Jan 31 and avoid the political deadlock Britain had suffered since 2017 when his predecessor Teressa May lost her majority.

"We expect the currency to remain supported given the credibility of the YouGov MRP poll and especially given the considerable lead that it gives to the Conservatives," wrote Valentin Marinov in a research note.

Marinov is the head of Group-of-10 currency strategy at Credit Agricole SA. 

"This could mean that even taking into account the inevitable polling errors, the Tory party should be still able to gain a comfortable majority."

The pound pared gains after touching a six-month against the euro to trade at 85.11 pence by 9:00 a.m. in London. 

It's heading for monthly gains of 1.2% in the longest winning streak against the common currency since 2015. 

Against the dollar, the pound gained 0.2% Thursday to $1.2943.

The pound has been tracking opinion polls closely ahead of the election and had slipped earlier in the week as surveys of voter intentions suggested the Conservative lead was narrowing.

According to a recent Bloomberg survey, markets prefer the certainty a majority government offers.