Pound Jumps After Germany’s Merkel Says Brexit Backstop Solution Possible By October 31st

The British pound jumped more than half a cent on Thursday to nearly a one-month high after German Chancellor Angela Merkel said a solution to the Irish border issue could be found before the Oct. 31 deadline for Britain to leave the European Union.

GBP versus USD hit $1.2265, the days highs currently trading.

Against the euro, sterling rose as high as 1.1057 more than 1% rise on the day and its highest since July 29.

The pound has fallen heavily in recent weeks on fears British Prime Minister Boris Johnson will take Britain out of the EU without a transition deal.

However, with investors having bet heavily against the currency, any sign of a breakthrough in Britain’s efforts to convince the EU to renegotiate the deal is likely to send the pound jumping,