Hedge Funds Reduce Their British Pound Net Short Position

Currency strengthens as investors expect Conservatives to win election and gain seats
Hedge funds have slashed their bets against the British pound to the lowest level since the Brexit vote in June last year, after the currency enjoyed its best month against the dollar in two years. The pared-back “short” bets, which would profit on a drop in the pound, followed Theresa May’s decision to call snap elections in June, a move that investors said would allow the ruling Conservative party to consolidate power and helped sterling recover its footing. The pound has climbed more than 3 percent against the US dollar and 5 percent against the Japanese yen since the general election was called last week. The UK currency has rallied 3.2 percent versus the dollar in April, its best monthly performance since April 2015 and making it the biggest gainer of all major currencies over the past month.