The pound is climbing on Monday, reaching its highest level in more than a month as a continued slide in the dollar helps currencies around the world.
Just after 9.10 a.m. GMT (4.00 a.m. ET) sterling is higher by around 0.55% on the greenback to trade at $1.2443, higher than at any point since December 19.
Here’s the chart:
Further weakness from the dollar comes after Trump’s first address as president on Friday highlighted his “America first” policies that were short on specific proposals, and disappointed investors hoping for details on his plans to stoke growth, spend on infrastructure and reduce taxes.
After a sharp rally following Trump’s November election that propelled it 3% higher for the month, the dollar gave up some of those gains against a backdrop of uncertainty surrounding the new president’s 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.
Traders and forecasters remain divided on sterling’s future path in 2017, with many seeing further weakness on top of the currency’s near 16% fall since the referendum, while others believe that the pound is now undervalued, and will rise over the course of 2017 as the Brexit picture becomes clearer.
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