Pound Falls As May’s Offer To Quit Fails To Break Brexit Deadlock

GBP fell in early London trading on Thursday after Prime Minister Theresa May’s offer to quit failed to convince hard line opponents to back her Brexit withdrawal agreement.

The pound edged down on Wednesday after an offer by Prime Minister Theresa May to quit to get her European Union divorce deal through parliament failed to win over key opponents of the agreement.

The pound fell to a day’s low of 1.3132 against USD, 0.4 percent lower on the session. Against the euro sterling dropped 0.7 percent to 1.1689.

The British parliament’s bid to agree an alternative plan for Brexit to May’s agreement with Brussels fell short on Wednesday, leaving the Brexit process as deadlocked as ever.

Northern Ireland’s DUP party, which props up May’s government, said it would not support her Brexit divorce deal.

The move makes it highly unlikely May will get her deal through parliament at the third attempt.

Profound uncertainty about how, or even if, Brexit will proceed is keeping investors wary and weighing on sterling.

May’s offer to quit – a last-ditch attempt to persuade rebels in her Conservative Party to back her – slightly lifted the pound earlier on Wednesday.

British politics is at fever pitch and traders are struggling to navigate the blizzard of headlines. The pound is volatile but remains around the same levels it traded at in late January.

May has admitted she lacks support to put her Brexit withdrawal deal to a third vote and that has kept sterling under pressure.

A key question for investors is whether some of the most influential Brexit-supporting rebels, such as Jacob Rees-Mogg, decide to back her deal.