Sterling rates soar
This morning the pound jumped by nearly 2% to $1.55 against the dollar as the FTSE 100 gained more than 1.5% in morning trading.
Gregor MacIntosh, chief information officer of Lombard Odier Absolute Return bonds, said: “Already UK capital markets – sterling and equities – have recovered some of the uncertainty that was weighing on them in the run up to this difficult-to-call election.
“Sure, the outlook is favourable for UK equities and sterling but Europe and the wider world will make most of the difference in the months ahead.”
Alan Wilde, head of fixed income at Baring Asset Management, said: “The upside potential from here for sterling is, in our view, limited but importantly the risk of a lurch lower in the pound is also less likely as financial markets are reassured by continuity and the prospect of further fiscal consolidation. This should ensure interest rates remain lower for longer.”