Pound rallies as May turns again and calls election

Author: Mike Paterson | Category: News

UK PM May has called a General Election for 8 June

Despite many previous protestations that she's not for turning on calling a snap election May has had a change of mind to add to her decision to vote Remain and then proceed to oversee Brexit.

All a bit unsettling really to have a national leader flying with the wind but, then again, in this day and age maybe not. The uncertainty of shooting from the hip has become the new normal not that it makes it any less scary.

Lots of uncertainty to follow today's decision but for the moment the markets are backing her to sweep to another 5 year term with bookie Ladbrokes offering 1-10 on a large majority.

There's risks to her strategy though and we'll see a lot Brexit-protest related voting which could mean a few more seats for the Lib Dems at the expense of the Labour Party and indeed the Tories themselves.

Lots to chew over in the coming days/weeks but right now the pound is ramping higher with GBPUSD posting 1.2652 after finally triggering stops through 1.2620 and EURGBP breaking down through 0.8450 to post 0.8430 demand lays waiting again.

GBPJPY up to 137.72 from lows of 136.14

I'm going to wait and see if/when the rally runs out of steam then sell again but there's lots of opportunities to be had if we miss this one.

Meanwhile short FTSE 100 remains a good play while GBP strength prevails.