* British exit polls point to hung parliament in blow for
* Pound down 1.5 pct after dropping as much as 2 pct vs
* Movements in dollar, euro and yen limited, Comey taken in
* Broader market focus shifts to next week's Fed meeting
(Adds details and quotes, updates prices)
By Shinichi Saoshiro
TOKYO, June 9 The pound fell sharply on Friday
after British Prime Minister Theresa May's Conservative Party
appeared set to fall short of an expected majority in a general
Sterling was down 1.5 percent at $1.2764 after sliding to as
low as $1.2705, down about 2 percent and the weakest
since April 18.
An exit poll predicted the Conservatives would win 314 seats
in the 650-member parliament and the opposition Labour Party
266, meaning no clear winner and a "hung parliament".
As of 0125 GMT the BBC reported that May's party was not
expecting an overall majority.
If the exit poll proves correct, the shock result would
plunge domestic politics into turmoil and could alter the nature
of Brexit talks.
For a graphic on the poll and results as they come in, see tmsnrt.rs/2q7tC48
Movements in other major currencies such as the dollar, euro
and yen were limited, also having taken in stride testimony by
former FBI director James Comey, which was initially expected to
be the other big event of the week.
"Britain's exit from the European Union will continue
regardless of the political turmoil likely to be created by the
election results. Other currencies, like dollar/yen, are not
reacting much as it is a more domestic affair this time, unlike
last year's Brexit vote," said Koji Fukaya, president at FPG
Securities in Tokyo.
"Focus for the broader currency market will now shift
towards the Federal Reserve's policy meeting next week."
The dollar was up 0.1 percent at 110.110 yen.
"There were many participants who wanted to take advantage
of the volatility resulting from a key event like the British
elections, which explains the pound's initial steep drop," said
Yukio Ishizuki, senior currency strategist at Daiwa Securities.
"The swings in the pound have not spilled over into other
currencies as the market was well hedged and prepared for a
variety of election scenarios."
The euro extended overnight losses and was 0.2 percent lower
The common currency was capped after the European Central
Bank on Thursday cut its forecasts for inflation and said
policymakers had not discussed scaling back its massive
Comey accused President Donald Trump of firing him to try to
undermine its investigation into possible collusion by his
campaign team with Russia's alleged efforts to influence the
2016 presidential election.
While this was the most eagerly anticipated U.S.
congressional hearing in years and was approached by investors
with caution, it did not offer fresh insight for the financial
markets. The Nasdaq managed to close at a record high on
Trump's critics say any efforts by the president to hinder
an FBI probe could amount to obstruction of justice. Such an
offence potentially could lead to Trump being impeached,
although his fellow Republicans who control Congress have shown
little appetite for such a move.
Buoyed by the pound's fall, the dollar index against a
basket of major currencies was up 0.4 percent at 97.319.
(Editing by Kim Coghill)