May had called a snap election seven weeks ago in the intention of building a bigger majority in order to strengthen her position as she negotiates the terms of the U.K.’s exit from the EU.

But the nationwide exit poll published after the closure of the voting stations suggested her Conservatives would only get 314 seats, 12 short of an overall majority, and 16 fewer than they won in their equally surprising victory two years ago.

The pound reacted with near-horror to a result that appears to raise uncertainty in U.K. politics sharply over the next five years. It immediately fell over 1.5% against the dollar to $1.2764.

The exit poll raises three immediate questions. First, it’s not clear how reliable the exit poll is. The corresponding poll in the 2015 election underestimated the Conservatives’ seat count by a dozen, although even if that repeated itself tonight, they would still only have a wafer-thin majority, leaving them effectively beholden to one or more of the small regional parties in Northern Ireland.

Second, it’s not clear who, and under what circumstances, would be willing to form a coalition government with the Tories. The Liberal Democrats, who ruled together with them between 2010 and 2015, are the most implacably opposed to leaving the European Union, and are horrified by the thought of leaving it without a transitional deal, as May’s Conservatives have indicated. Even the Northern Irish unionist parties who are usually sympathetic to the Tories, have a very different attitude towards Brexit because it threatens the reintroduction of a hard border with the Republic of Ireland and a much bigger disruption to its economy.

Third, even if the poll is right, it’s impossible yet to say what impact such a “hung” parliament would have on the Brexit talks. All three major parties—the Tories, Liberal Democrats, and Labour—have promised to honor the result of last year’s Brexit referendum, but with varying degrees of commitment. Only the Tories have promised to force Brexit through come hell or high water.

“It’s going to be a challenging one,” for U.K. financial markets, said Dean Turner, an economist with UBS Wealth Management in London. He argued that the currency, rather than the benchmark FTSE 100 stock index, is the better prism through which to view the result, because the signal from the stock market is polluted by the high proportion of overseas earnings the companies in the index generate.

“I think we could see a bit further weakness [in the pound] because clearly the markets were positioned for a different result,” Turner said. “But I’m not jumping to any conclusions in terms of what Brexit actually looks like. I would say it raises the level of uncertainty over the talks—and they start in 11 days time. ”

“It seems again that the British public has decided to surprise everyone,” said Chris Beauchamp, chief market analyst at spread better IG in London. He cautioned that no official results have come in from the 650 voting districts yet, but warned that “markets will not like the idea of the Conservatives losing their majority.”

This article has been updated to include analyst comment.