LONDON (Reuters) – Sterling surged on Thursday and hit its strongest against the euro since shortly after the 2016 Brexit referendum after an exit poll indicated Prime Minister Boris Johnson’s Conservative Party was on course for a big parliamentary majority.
FILE PHOTO: Wads of British Pound Sterling banknotes are stacked in piles at the Money Service Austria company’s headquarters in Vienna, Austria, November 16, 2017. REUTERS/Leonhard Foeger
Investors, chastened by 3-1/2 years of political uncertainty in Britain, have seized on the likelihood of a decisive Conservative majority, believing it will allow Johnson to push ahead with getting Britain out of the European Union at the end of January.
“Just as Boris Johnson was desperately seeking his majority, this result would give the markets their ultimate wish: clarity,” said Dean Turner, Economist, UBS Wealth Management.
The exit poll, which suggested Johnson would get a majority of 86 – the largest of any Conservative leader since Margaret Thatcher won in the 1980s – sparked an immediate rally in sterling.