British prime minister Theresa May had a plan. Catch rivals off guard by calling a “snap” general election after repeated denials that you would do such a thing. Tend to a 20-percentage-point polling lead over the Labour opposition party during a short campaign. Win big on election day, June 8, and use the thumping new mandate at home as a platform to push around the eurocrats in Brussels during the subsequent Brexit negotiations and quiet any rebels at home. Put feet up.
Investors bought into the plan (paywall). When May announced the election on April 17, the pound surged to its strongest level in six months against the dollar. But now, with a week to go until the vote, it’s safe to say that things aren’t going according to plan.
The latest opinion polls show May’s Conservative party steadily losing its lead over Labour, with a poll out late yesterday showing a mere three-point margin for the Tories. Traders aren’t sure what to make of this, so the pound has been bouncing around in response to each new poll.