The pound posted its biggest advance in almost two weeks after reports that U.K. Prime Minister Theresa May is on her way to Strasbourg for last-minute talks with the European Union.
Britain’s currency rose as much as 1.2 per cent to US$1.3169, its biggest gain since Feb. 26. It advanced against most of its Group-of-10 counterparts, while euro-pound fell to 0.8533, the lowest level since Feb. 27. The turnaround for the currency follows an earlier drop to US$1.2949 after the U.K. said talks were “deadlocked” and May failed to secure significant concessions from the EU in the latest round of talks.
“The market is probably getting excited there’s something in the works,” Brad Bechtel, global head of foreign-exchange at Jefferies LLC, said by phone. “She wouldn’t be jumping on a plane unless there’s the potential for something to come out of it -- that’s the way the market is thinking.”
May is heading to Strasbourg to talk to EU Commission President Jean-Claude Juncker about Brexit, her office said. A person familiar with the matter said the trip doesn’t mean there’s a deal. May is due to put her Brexit deal to Parliament for a vote on Tuesday.
“Volatility will remain high and we’ll continue to whip around for the next couple of weeks on every headline,” Bechtel said.
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