The Pound Sterling continues to move off of the recently struck 20-month trough after it was confirmed that the Prime Minister will ask for the British Parliament to approve her latest Brexit proposal next month. Analysts caution that Theresa May will be fighting the fight of her life in order to get her deal through given that she still needs to find the backing of members from her own party. Ms. May has already postponed the vote once, after party members cautioned her that the proposal would be voted down. What is different this time around is that the Prime Minister is working to get the backing of the European Union to acknowledge that they will not accept a “managed no deal;” essentially, the EU will say it is all or nothing which analysts say could make Ms. May's proposal appear the better option.
As reported at 11:45 am (GMT) in London, the GBP/USD was trading at $1.2698, a gain of 0.675%; the pair has ranged from a session peak of $1.2706 to a low of $1.2610. The EUR/GBP is trading at 0.8976 Pence, down 0.22%, and off the session low of 0.89715 Pence.
Outlook for Brexit Still Dubious
There are also some hopes that a Brexit delay could be agreed to if the Prime Minister does not get Parliamentary support, or even perhaps that a second referendum could be pushed through. Analysts warn that the specter of a no-deal Brexit could be catastrophic for the Pound, with perhaps as much as a 10% loss as a result. They also warn that the UK's competitiveness as it relates to the rest of the world will have suffered tremendous damage as the result of a no-deal.