Sterling rose
around half a percent to 7-month highs above $1.29 on Thursday, helped
by a broader softening of the dollar and polls showing Prime Minister
Theresa May on course for a landslide in the early election she has
called for June.
The
pound rose by as much as 4 cents when May announced the election nine
days ago but investors have looked unsure about driving the pound higher
in the days since and the highs hit briefly on Thursday were only 10
ticks above last week's.
By 0930 GMT it had risen 0.4 percent to $1.2898, having hit a high of $1.2917 in early trade in London. It also gained 0.4 percent to 84.56 pence per euro, around half a percent below intraday highs from the previous session.
Bank of America Merrill Lynch strategist Kamal Sharma said May's lead in the polls had seen off any downward pressure on the pound, leaving it clear to benefit from tax flows which historically tend to push it higher in April.
Over the past 12 years, sterling has risen by an average of 2.3 percent every April. It is up around 2.5 percent for the month so far.
Sharma, however, cautioned that the pound tends to do less well in May. Commerzbank technical analysts pointed to barriers to the pound breaking $1.30 in the near-term.
By 0930 GMT it had risen 0.4 percent to $1.2898, having hit a high of $1.2917 in early trade in London. It also gained 0.4 percent to 84.56 pence per euro, around half a percent below intraday highs from the previous session.
Bank of America Merrill Lynch strategist Kamal Sharma said May's lead in the polls had seen off any downward pressure on the pound, leaving it clear to benefit from tax flows which historically tend to push it higher in April.
Over the past 12 years, sterling has risen by an average of 2.3 percent every April. It is up around 2.5 percent for the month so far.
Sharma, however, cautioned that the pound tends to do less well in May. Commerzbank technical analysts pointed to barriers to the pound breaking $1.30 in the near-term.
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