Brexit optimism continues to mount
Cable busted through buy stops to 1.3270, which is the highest since September. The gains come on talk of a Brexit delay, a second referendum and a deal.
May promised a vote to parliament to extend Article 50 if they reject the divorce deal in a vote on March 12 or sooner. That puts the possible outcomes at: 1) a deal 2) a delay. Both are GBP-positive and the move reduces near-term UK economic uncertainty.
May had ruled out a delay many times but has caved to pressure within her party and the business community. She had believed that the threat of a no-deal Brexit would help her extract better terms from the EU. German leaders say they are open to an extension to the end of June.
Labour is now also backing a second referendum and could push for a vote a soon as tomorrow. It will probably lose but the euroskeptic wing of the Conservative party may soon be pushed into accepting any deal rather than risking losing the ext altogether.
Cable is up 165 pips on teh day in its largest rally since early November. The run broke the resistance of the January and October highs. A rise above 1.3298 would be the highest since July but that may be a bridge too far today.