Sterling Rallies As PM May Offers Second Referendum, Later Falls

The British pound today rallied higher after news emerged that the British Prime Minister Theresa May would offer MPs a chance to vote for a second referendum. The GBP/USD currency pair rallied from news 3-month lows triggered earlier in the day after the opposition Labour Party confirmed that it would vote against PM May’s latest Brexit deal.
The GBP/USD currency pair today rallied from a fresh 3-month low of 1.2684 in the European session to a high of 1.2813 in the American session before retracing most of its gains.
The currency pair opened today’s session trading in a tight sideways range before dropping to daily lows in the early European session. The currency pair fell after Labour Party MP Emily Thornberry confirmed that the opposition party would still vote against the latest Brexit deal in early June. The pair got some relief in the mid-London session after news reports indicated that PM May would offer U.K. leaders the opportunity to vote on whether the country should have a second referendum. The cable kept up the rally for a few hours before Theresa May’s actual speech drove the pair lower.
The cable retraced all of its gains in the American session after PM May told MPs that they could only vote on a second referendum if they approved the current withdrawal deal, which did not resonate with investors.
The currency pair’s future performance is likely to be affected by Brexit headlines and tomorrow’s multiple UK releases.
The GBP/USD currency pair was trading at 1.2732 as at 17:16 GMT having fallen from a high of 1.2813. The GBP/JPY currency pair was trading at 140.90 having risen from a low of 139.62.

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