- Sterling jumped after Business Insider reported that the EU Parliament is preparing a resolution that will call for more flexibility in a future relationship with Britain.
- The pound climbed around 0.5% against the euro on the news.
The pound popped on Tuesday morning after Business Insider reported that the European Parliament is preparing a “detailed,” 60-paragraph resolution which will call for more flexibility in future relationship talks with Britain.
Sterling, which had been trading in negative territory against the US dollar, and only marginally higher against the euro during morning trade on Tuesday, jumped on the report, with the pound moving into marginally positive ground on the dollar, and rising more than 0.5% against the euro, as the charts below illustrate:
According to the report, the European Parliament is pushing for a future relationship with the United Kingdom which could allow for Britain to retain “privileged” access to the single market.
This marks a break from the direction previously taken by the EU’s negotiating team, which has instead suggested that Theresa May’s negotiating red lines mean Britain may only have access to a Canada-style free trade deal.
Sterling has rallied strongly in the first month and a half of 2018, although much of the pound’s recent rally is a story of a weak dollar than a strong pound, with the greenback dragged lower by a number of factors.
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