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The Pound jumps following Theresa May’s win remaining UK Prime Minister

The pound surged on Wednesday after British Prime Minister Theresa May survived a no-confidence vote on her leadership, allowing room for Brexit to go ahead.

IG Analyst

Publication date : 2018-12-13T00:31:00+0000

Theresa May

Source: bloomberg

May survived a confidence vote, with the support of 200 conservative lawmakers backing her leadership, and 117 indicating no confidence, largely due to May’s Brexit push.

This comes after May cancelled a parliamentary vote on her deal on Monday, with many in her party doubting her motives.

“A significant number colleagues did cast a vote against me and I’ve listened to what they said,” May said as she addressed the media after her win.

After the win, May addressed the need to focus on other issues during her leadership.

"But while delivering Brexit is important, we also need to focus on the other issues that people feel are vital to them, that matter to them day-to-day, the issues that we came into politics to deal with.” She said.

IG Market Analyst, Kyle Rodda says the vote has handed us what could be considered a dead rubber.

"It doesn't really advance Brexit any more. It hasn't killed off the whole thing either. The pound has reacted accordingly: it fell when the news of challenge came through, but when it became clear a May victory was likely, it recovered, and has traded as per normal since." Mr Rodda said.

Sterling rallies, markets react

As the Brexit deal hangs in the balance, the pound has jumped on Wednesday in response to May’s win -- recovering from a 20-month low.

The sterling rose 1.14% rising to $1.2627 after lows of $1.2477. Against the sterling, the euro fell 0.6% to 99.05 pence.

However, the dollar index was down 0.34 % at 97.054, with traders cautious amid fears of federal government chaos.

Despite the win, GBP/USD remained shaky.

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