Parliament will today start debating the terms of Prime Minister Theresa May’s withdrawal deal for Britain leaving the European Union (EU) as the countdown to the meaningful vote ticks nearer. The vote is expected to be held next week on January 15. Brexit negotiations have proved to be a major influencer for pound movement in recent months, with Sterling reacting negatively to political uncertainty as Mrs May struggled to gain support for her deal with Brussels. Today the pound is trading at €1.1134 against the euro as of 09:00 GMT, slightly up on opening levels.
Against the US dollar, Sterling is worth $1.2768.
The pound lost value against both the euro and US dollar yesterday, dropping by as much as half a percent against the American greenback.
Kit Juckes, currencies strategist at Societe Generale, said it was “clearly impossible” to make reliable sterling forecasts.
He said: “Anything from an endlessly drawn-out Brexit to an amicable agreement or a hard Brexit, everything remains within the realms of possibility.
“That the outlook for sterling also ranges from a recovery rally to currency crisis.”
The Commons will begin five days of debate today after the Prime Minister sensationally pulled a vote before Christmas, admitting she was heading for defeat in the face of opposition.
The move sent the pound tumbling against major currencies.
Ahead of the debate, MPs opposed to a no-deal break were braced to back Mrs May into a corner by inflicting another defeat on the Government.
Twenty Conservative MPs joined opposition parties in backing a cross-party amendment to the Finance Bill intended to limit the Government’s powers to make tax changes in the event of no-deal.
The rebels included former ministers Ken Clarke, Sir Michael Fallon, Justine Greening, Dominic Grieve, Sir Oliver Letwin and Sam Gyimah.
Sir Oliver, who supports Mrs May’s deal, said they were ready to table similar amendments to other Brexit legislation to warn they were prepared to put paid to “this disastrous proposal”.
“The majority in this House will sustain itself, and we will not allow a no-deal exit to occur on March 29,” he said.
Downing Street insisted the amendment – tabled by senior Labour MP Yvette Cooper and Tory former cabinet minister Nicky Morgan – was no more than an “inconvenience” which would not prevent the Government collecting taxes.
But supporters said the vote – of 303 to 296 – showed there was now a clear majority of MPs who would oppose a no-deal if Mrs May cannot, as many expect, win the backing of the Commons for her agreement.