With Johnson long the frontrunner to win the leadership race, currency markets had already priced in his election and attention now turns to the make-up of his cabinet.

Analysts said the pound's small move higher after the announcement was a relief rally following a dismal period for the sterling in which it had fallen to more than two-year lows.

Sterling, trading around $1.2450 beforehand, rose to $1.2475, still down 0.1% on the day.

Against the euro it was little changed at 89.74 pence , down 0.1% on the day.

"It looks to me that he got more than 60 pct so I am comfortable that's largely priced in. But now he has to turn the party mandate into a country mandate and that's going to be much much harder," said Stephen Gallo, head of European FX at BMO Capital Markets.

"As for sterling, it's a 'sell on rallies', 100%. Regardless of how you slice the cake, we will either end up with a no deal or a messy general election," said Stephen Gallo, head of european FX strategy at BMO Capital Markets.

British gilt yields rose marginally after the result, with two-year yields now flat on the day at 0.49% versus slightly down earlier. But they were still near three-week lows.

There was no move in UK stock markets.