Sterling edged down today, but remained near a six-month high versus the euro.
It came on the back of a new poll reinforcing investors' expectations the ruling Conservative Party will win a parliamentary majority in Britain's election next month.
Prime Minister Boris Johnson's Conservatives have surged to an 18-point lead over the opposition Labour Party, according to an opinion poll published by market research company Kantar.
If the Conservatives win a majority on December 12th, expectations are the House of Commons would approve the Brexit deal agreed with Brussels last month and Britain would exit the European Union on January 31st, ending three-and-a-half years of uncertainty.
Brexit Party leader Nigel Farage said the Conservatives would probably win the election with a small majority.
Much of the expectations of a Johnson win are already priced into the pound, HSBC strategists told Reuters.
"While sterling definitely looks cheap, the Johnson majority is 70% priced in after this weekend's polls and the pound is unchanged over the past month," HSBC strategists said.
The right question, they said, was not whether sterling would jump in the next two months, but by how much.
The same view was shared by ING strategists, who did not expect the pound to strengthen beyond 85 pence per euro, even if Johnson wins the first televised debate with opposition Labour Party leader, Jeremy Corbyn, later this evening.
Just before 5pm, sterling had shed 0.2% of its value versus the euro to trade at 85.68 pence, still close to the six-month high of 85.22 pence reached yesterday.
It also fell by 0.13% against the dollar.
Sterling has climbed from $1.20 early in September to near $1.30 as hedge funds reduced their short positions on the currency.