Last week, the pound had its best week since January, strengthening on Friday afternoon. This came as Prime Minister Theresa May tried to convince euro-sceptics to back her deal ahead of a third ‘meaningful’ vote, which is thought to take place this week.
Despite these highs, there is still plenty of uncertainty surrounding the pound. EU members will have to agree on whether or not to allow an extension of Article 50. If they do allow this, it is uncertain as to whether it will be a short extension or a longer one.
A longer extension is favoured by President of the European Council, Donald Tusk. However, if the Prime Minister manages to get her deal through Parliament on the third attempt, then there will probably be a shorter extension.
It is thought likely that EU members will allow for an extension, however it is unclear as to whether they will reach a final decision this week. With so many factors and possible outcomes coming into play, it’s reasonable to expect another extremely choppy week for sterling.
