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Theresa May’s confidence vote is good-ish news for the pound

Britain's Prime Minister Theresa May addresses the media outside 10 Downing Street after it was announced that the Conservative Party will hold a vote of no confidence in her leadership, in London
Reuters/Toby Melville
Merry Christmas, prime minister.
  • Natasha Frost
By Natasha Frost


Published This article is more than 2 years old.

If you’re heading to the UK for the holidays, there hasn’t been a better time to put your spending money in sterling for a while.

That’s one of very few silver linings after a week in the doldrums for the pound, which reached some of its lowest lows since April 2017 ahead of the confidence vote on British prime minister Theresa May. Her win is clearly a source of some relief for traders—the pound rose steadily as victory looked more likely, eventually jumping 0.9% then falling back slightly immediately after the vote.

Whether it can brave the stormier seas ahead remains to be seen. A no-deal Brexit looks more and more likely, bringing chaos with it. May has promised that a vote on her EU withdrawal agreement will take place before Jan. 21, but MPs are all but certain to vote against it.

Since the initial Brexit vote, in May 2016, the pound has struggled to recover from its first perilous nosedive. Highs of over $1.40 to the pound in May 2018 proved short-lived, while recent weeks of hair-raising political uncertainty have dragged it down to its lowest point all year.

📬 Kick off each morning with coffee and the Daily Brief (BYO coffee).

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