LONDON — The pound dipped lower on this morning as currency traders waited for the Supreme Court’s ruling on the historic Article 50 case heard in December.
One of the most important legal cases in British history will reach its conclusion on Tuesday morning, when the Supreme Court’s 11 justices rule whether Theresa May must secure parliamentary approval before triggering Article 50 and initiating the country’s formal departure from the European Union.
The ruling will be handed down at around 9.30 a.m. GMT (4.30 a.m. ET) and although the government is thought to be preparing to lose its appeal, there is likely to be a significant reaction in the markets regardless of the verdict.
It is most likely that the pound will drop further should the government win its appeal, and climb if it is ruled that there must be a vote on Article 50.
Around 8.20 a.m. GMT sterling is lower by 0.4% to trade at $1.2482, as the chart below illustrates:
After falling to its post-Brexit vote low earlier in January, Sterling has rallied in recent days, bolstered by a combination of factors, including a fall in the dollar triggered by worries about President Trump’s future policies.
That fall in the dollar coincides with strength from the pound after Prime Minister Theresa May finally gave the markets a tiny bit of clarity on the UK’s position going into Brexit.
May confirmed Britain will leave the European Single Market, signalling Britain is heading towards a “hard Brexit” — shorthand for an EU exit that takes the country out of both the European Single Market and Customs Union in order to gain full control over EU immigration to the UK.