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Pound suffering from heat stroke; under $1.26

As anyone in the UK will tell you, it’s hot at the moment. Unusual. Meanwhile, sterling is sliding. Not so unusual. Now, the currency has wiped out almost all of its boost from Theresa May’s ill-fated announcement of a general election in April.

The currency has dropped by 0.3 per cent so far today to under $1.26, hit by a fresh note of dovishness from Bank of England governor Mark Carney, who yesterday said it would soon become clear whether Brexit will indeed prove to be a “land of cake”.

Kit Juckes at Société Générale said:

The Conservative party’s lack of progress in reaching a deal with the DUP won’t help sterling either.

Tactically, selling sterling and looking for a test or break of the 200-day moving average at $1.2555 may be easier than trading against the euro, and as good a way of spending the day as any (unless sweating at Ascot or Glastonbury are your thing….)