The pound rallied as U.K. Prime Minister Theresa May said she will offer lawmakers a vote on whether to hold a second Brexit referendum as part of a plan to get her Brexit deal over the line.

Sterling gained as much as 0.7 per cent ahead of May’s speech in London, before paring the move. Lawmakers have already voted against holding a second referendum in a series of votes on Brexit options, with May due to put her latest offer before Parliament in early June.

“If the chance is rising for her bill to get through, the pound has some more room to the upside after the last few weeks of selling,” said Manuel Oliveri, a strategist at Credit Agricole SA. “Be prepared for more upside in the short term.”

Embedded Image

May said that the vote on whether to have a second referendum would be conditional on her Brexit bill passing the first voting stage in Parliament. With the Brexit challenge harder than she anticipated, she said she will also give lawmakers a choice on customs arrangements.

The pound gained 0.3 per cent to $1.2765 by 4.25 p.m. in London, after slumping earlier in the day to a four-month low as senior members of May’s party jockeyed to replace her. Sterling gained 0.3 per cent to 87.47 pence per euro, breaking the longest run of losses versus the euro in the history of the shared currency.