Pound Jumps on U.K. Election Exit Poll Numbers

By James Ramage 

        The pound rose sharply against the dollar late Thursday after exit polls in the U.K. forecast that Prime Minister David Cameron's Conservative Party would win the most seats in the country's parliament.
        Sterling strengthened 1.3% versus the greenback in late U.S. trading within minutes of the exit-poll results. The pound jumped as high as $1.5449, a one-week high. Before the results, the pound traded roughly flat on the day at $1.5248
        For investors, the exit poll suggests that the U.K. government's agenda is likely to stay consistent, even though it remains unclear what kind of coalition will be forged, said Steven Englander, head of developed-market foreign exchange strategy at Citigroup Inc.
        "For now, in market terms, the continuity is unambiguously seen as reducing uncertainty and helping sterling," Mr. Englander said. "The approximate fear of changing government and changing economic policy has been relieved."
        The pound has rallied over most of the past month after a rough start to 2015. Though investors and traders anticipate that the currency will gyrate for a time after the election, some investors have said they would look for opportunities to boost exposure to the sterling if it weakens significantly.
        The release of the exit polls came at the end of the U.S. trading day and before trading in Asia was fully under way. Trading is usually thin at this time, which potentially exaggerated the size of the move.
        Write to James Ramage at james.ramage@wsj.com
        (END) Dow Jones Newswires

        May 07, 2015 17:59 ET (21:59 GMT)

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