The British pound erased its earlier gains after the currency moved higher against the US dollar on Tuesday. Mixed sentiments between traders followed a legal case that is presented in front of the Supreme Court of the United Kingdom, which might delay the nationâs departure from the European Union.
The Supreme Court started hearing the British governmentâs appeal over its ability to trigger Article 50 without needing a parliamentary approval. The government is hoping to get a ruling by January 2017 to initiate the process of Brexit by March.
However, traders are optimistic that the court case will prevent, or at least delay, the governmentâs plan. If the government lost the case, the parliament will need to decide wither to approve triggering Article 50, which is expected to add more transparency to the Brexit process.
Until the court decides its final ruling, the poundâs movement is expected to be erratic as traders look for any signs on the future of the UKâs growth and economic ties with the European Union. Recent comments from British officials hinted at a possible deal to maintain access to the European single market in exchange for contributions for the European Unionâs budget.
GBP/USD traded at 1.2677 as of 21:50 GMT after rising to 1.2769 at 09:00 GMT, the pairâs highest level since the beginning of October. GBP/USD started trading today at 1.2721.
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