British Prime Minister Gordon Brown on Tuesday launched a month-long election campaign likely to be dominated by the economy and shaping up as the most unpredictable contest since 1992.

Standing outside his Downing Street residence in the sunshine, with his cabinet arrayed behind him, Brown ended weeks of shadow boxing by confirming the May 6 election date, just a month before the last possible time for an election.

“It’s probably the least well-kept secret of recent years but the queen has kindly agreed to the dissolution of parliament and a general election will take place on May 6,” Brown said, starting his bid to extend Labour’s 13-year grip on power.

The opposition Conservatives lead centre-left Labour in opinion polls. But the election result is far from certain as public support for both main parties remains volatile and the opposition faces a big challenge in securing power.

Polls point to a hung parliament in which no party has an overall majority because support for the centre-right Conservatives is less efficiently distributed across Britain’s 650 parliamentary constituencies.

An inconclusive election result is rare in Britain and is the worst-case scenario for financial markets, which want a clear outcome and firm action to tackle a budget deficit running at almost 12 percent of GDP.

The pound fell against the dollar on Tuesday, dragged down by political uncertainty.

“Sterling will now be at the whim of the opinion polls until the election on May 6. Polls showing no clear Conservative majority will be seen as negative for the pound,” said Michael Hewson, analyst, at CMC Markets.

OPENING PITCHES

Conservative leader David Cameron, addressing supporters on the banks of the River Thames opposite parliament, called it the most important election for a generation.

“You don’t have to put up with another five years of Gordon Brown,” said Cameron, 43, a former public relations executive.

How best to run an economy slowly emerging from the worst recession since World War Two is likely to be the central theme in the campaign, entwined with issues such as how to manage public services on tight budgets.

The Conservatives promise to cut the deficit harder and faster than Labour but have also pledged to exempt most workers from a payroll tax rise Labour plans for next year.

The 59-year-old Brown, who served as finance minister for a decade before replacing Tony Blair in mid-term in 2007, said the recovery was too fragile to be entrusted to the Conservatives.

“Britain is on the road to recovery and nothing we do should put that recovery at risk,” said Brown.

With the exception of Labour’s landslide victory in 1997, no party has secured more than a five percent swing in the national vote at a general election since 1950. The Conservatives require a swing of 6.9 percent to secure an outright win.

The outgoing parliament has been tarnished by a scandal over members’ expenses. One hundred and forty-five members of parliament — just over a fifth of the total — are standing down, many with reputations harmed by the scandal.

“The economy is the number one issue, but the aftermath of the expenses scandal still scars the political landscape. It has an impact on things like turnout and the performance of minor parties, which is going to be crucial,” said Andrew Hawkins of pollster ComRes.

The smaller opposition Liberal Democrats could play a pivotal role if neither of the big parties wins a majority.

The new parliament will meet on May 18, the government said. That is later than usual to give new members of parliament more time to prepare for their career change. It would also allow longer for bargaining if no party wins a majority.

Adding spice to the campaign will be Britain’s first live television debates — between Brown, Cameron and Liberal Democrat leader Nick Clegg.

(Additional reporting by Sumeet Desai and Caroline Copley; Editing by Jodie Ginsberg and Paul Taylor)