GBP higher, but risks remain

Longer-term, there are two key risks for GBP, the UK's unsustainable current account deficit (6.2% of GDP) and the EU referendum, promised for end-2017 at the latest. 

Both are manageable, however. The current account deficit is the counterpart to the budget deficit domestically and so long as the government's fiscal strategy is credible, it should remain fundable. 

"This would have been a much greater risk under other, less certain, election outcomes. When we look in detail at the EU referendum risk, we concluded the UK electorate is probably less Eurosceptic than the most recent opinion polls imply", says RBC capital markets.

In the longer term, the balance of opinion has almost always been in favour of staying in and it still is when pollsters add a qualification that the government recommends voting to stay. The long-term view on GBP is moderately constructive.