Word that Gordon Brown is literally packing his bags is helping give the pound a further lift, popping briefly to 1.4930. Selling of EUR/GBP has pushed the cross down to 0.8500.
0.8425/40 are the two lows seen in this cycle.
Beware getting too bulled up on sterling until seeing the details of the agreement between the Conservatives and LibDems. If the Conservatives had to give away the store or if the agreement is weak, the pound could sell off again.
UPDATE at 11:31: Telegraph reports senior Tories say a minority government is the most likely outcome. Minority governments are inherently unstable and may keep the pound’s rebound less strong than it otherwise would be…
UPDATE: Reuters at 15:28–Brown spokesman says he remains PM...
