GBP Rallies Upon Hopes ‘ No Deal Brexit’ Will Be Ruled Out.

GBP rallied this morning against the dollar and euro in early trading in Europe Wednesday, as the market leans on balance towards believing that Brexit will be softened, delayed or even cancelled.

The U.K. parliament rejected the government’s deal on leaving the European Union for a second time on Tuesday, effectively killing it as the EU has said it isn’t prepared to negotiate any more on the terms of leaving.

At 03:00 AM ET (0800 GMT), the pound was at 1.3142, up from around 1.3060 immediately after the vote, while GBPEUR squeezed higher to the 1.1646 level from sub 1.1600 levels.

The House of Commons is due to vote later Wednesday on whether to leave the EU without a deal on March 29, an option that has never commanded a majority and is highly unlikely to do so now.