The pound fell to an 18 month low against the dollar after Theresa May called off a vote in Parliament on her Brexit plan. May is now seeking to reschedule the vote on the terms of the U.K.’s exit from the European Union. However, the uncertainty meant the pound fell 0.5% versus the dollar to $1.2664.
Commenting on the fall in Sterling following Theresa May’s plans to delay Parliament’s meaningful vote on her Brexit deal, Andy Scott, Associate Director at JCRA, the independent financial risk management consultancy, said: “Sterling is down sharply across the board on expectations that Theresa May will pull the parliamentary vote on her Brexit deal, once again raising the risk of a no-deal outcome. Sterling has fallen around one percentage point against both the Dollar and the Euro as we head towards 2019 with uncertainty ever present.
“May is reported to be planning to travel to Brussels to seek a legally-binding assurance on the back stop, in an attempt to gain support of MPs who fear being trapped indefinitely under the current proposal. But with her authority severely depleted, the political stakes are high for May who’s position as Prime Minister could soon be deemed untenable.
“The uncertainty will meanwhile continue to exert downwards pressure on Sterling.”