On Friday morning, Britain woke up to the fact that the Conservatives ran a poor election campaign and Theresa May is not as popular as she thinks. Similarly, Nicole Sturgeon managed to lose an awful lot of her seats in Scotland. As always, the pound took the first hit and then we will see what happens next. Cable, which has struggled under the psychological level of US$1.30 for the best part of eight weeks, fell a bit, as did the pound against the euro, which matched January’s weakest level of 88.6 euro cents. The cost of buying protection against further weakness increased, with the cost of cable puts also matching January’s high. However, price action can generally be said to be jittery, but not catastrophic. Steely determination is needed.
