Pound turns volatile as UK parliament throws out Brexit deal
16 January 2019
The British pound seems to be the only gainer in the defeat of Theresa May’s Brexit deal in parliament. The British currency powered back towards multi-week highs after parliamentarians voted down the EU-UK Brexit deal.
During the past two years, the pound has had a rough ride, falling against the dollar and other major currencies.
The immediate aftermath of the Brexit referendum saw sterling decline sharply in value.
And as the parliament vote out UK's withdrawal deal from the European Union, the currency gained, bringing back volatility in the currency market.
Pound rose sharply above 1.27 dollars, having touched levels around 1.28 dollars and looked set to be more volatile going forward, depending upon what is in store ahead for Britain.
Analysts expect Sterling to gravitate further depending upon the next moves from the government and the European Union.
Many, however, expect more losses for sterling amid uncertainty over how the UK’s eventual withdrawal from the EU will take shape. With speculators having an upper hand in the market, the British currency can expect a “wild ride,” say currency traders.
Some even expect the “overvalued” pound to be at least 30 per cent lower than it had been.
The British currency has been sliding since 2008, well before the Brexit referendum. According to Keen, that means that Britain has some other serious economic problems.