Left Menu
Development News Edition

UPDATE 1-Pound rises on EU Brexit deal approval; UK vote in focus

The pound rose on Monday after the European Union sealed a Brexit deal but the currency's gains were curbed by doubts about Prime Minister Theresa May getting the agreement through a divided British parliament.

With European leaders finally endorsing May's plan for future ties between Britain and the bloc, sterling traders are focused on a parliamentary vote on the deal likely to take place in mid-December.

For now, the odds look stacked against May with criticism of the agreement approved in Brussels on Sunday from all sides, including from the Northern Irish party propping up her minority government.

"The failure of the pound to rally on recent positive developments suggest the market is pricing in that the deal won't pass the first time in parliament," said Lee Hardman, a currency analyst at MUFG.

"During the next two weeks the pound will likely trade with increased volatility," he added.

Brexit negotiations and political uncertainty in Britain remain the key drivers for the pound, and many analysts are cautious about its prospects.

The pound traded up 0.3 percent versus the dollar at $1.2852 at 1130 GMT and traded flat against a resurgent euro at 88.43 pence.

Recent positioning data suggests hedge funds have started to unwind large short positions on sterling as hopes grow that Britain may manage to negotiate an orderly Brexit.

Net short positions on the pound saw their fourth biggest weekly drop in over a year, according to CFTC data for the week ending Nov. 16.

But growing domestic opposition to May's Brexit arrangement has continued to pressure sterling, pulling it down 2.5 percent from a Nov. 7 high of $1.3176.

"The outcome being priced into GBP right now is the idea of a successful second vote in Parliament on the negotiated deal and an orderly exit on March 29," said Simon Derrick, chief currency strategist at BNY Mellon.

Derrick said a "significant financial market reaction" to the failure of the first vote could help concentrate the minds of the politicians that voted against it.

May will hold an emergency cabinet meeting on Monday to brief ministers on her strategy before beginning a two-week campaign to sell her plan directly to the British electorate. (Reporting by Tom Finn, Editing by William Maclean and Ed Osmond)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

Download The Devdiscourse News App for Latest News.



Future of Food: Technology fostering the road to global food security

Technological innovation can help address most of the pressing issues facing the world today including food security by enhancing productivity, improving financial services, managing resources, addressing environmental concerns, etc....

Conspiracy theories on COVID 19: Legislators, Scientists, and Journalists all joined the Caravan

Conspiracy theories are not new for virus epidemics. There have been conspiracy theories on HIV-AIDS, Polio Vaccines, Ebola Virus, and several other diseases as well. However, what makes the 2019 Novel Coronavirus different from others is ...

Now it’s a war, Uganda deploys army to combat locust swarms

Its for the first time after 1986, the locust swarms have attacked Uganda twice in a season. With the increasing number of countries of Africa under attack by locust swarms, the problem seems to have taken a regional paradigm. Its very diff...

Top 10 Fake News, Myths and Realities on 2019 Novel Coronavirus COVID 19

With nearly 1500 deaths by January 14 and around 65,000 infections in China, the Novel Coronavirus 2019 has become one of the worst health epidemics of the 21st Century. However, 8,573 people have been cured but the rumor mongers are a...


Latest News

Pak confirms first two cases of coronavirus; educational inst in Sindh & Balochistan closed

After two persons returning from Iran tested positive for the deadly coronavirus in Pakistans largest city Karachi, all educational institutions in Sindh and Balochistan provinces have been closed. On Wednesday, a young man tested positive ...

Russia urges tour operators to avoid Italy, S.Korea, Iran over coronavirus

Russias Federal Tourism Agency on Thursday recommended national tour operators suspend tours to Italy, South Korea and Iran until the outbreaks of coronavirus there are brought under control. The move came a day after Russia said it would s...

China's central bank to ensure ample liquidity through targeted RRR cuts

Chinas central bank said on Thursday that it will ensure ample liquidity through targeted reserve requirement ratio RRR cuts for banks at an appropriate time, and will keep monetary policy prudent and flexible to support the economy. China ...

Pleas moved in HC seeking FIR against Sonia, Rahul, Priyanka, others for alleged hate speech

Pleas were moved before the Delhi High court on Thursday seeking lodging of FIR against Congress President Sonia Gandhi, ex-president Rahul Gandhi, its general secretary Priyanka Vadra and others for allegedly giving hate speeches. One of t...

Give Feedback