The pound rose on Tuesday after British Prime Minister Theresa May saw off a rebellion in parliament over amendments to a bill for the country’s exit via the EU next year of which had threatened to undermine her authority.
May had faced a showdown with lawmakers who wanted the power to force her government to go back to the negotiating table if they reject a Brexit deal, testing her plans for leaving the European Union.
A minister long critical of the government’s handling of Brexit resigned earlier in protest at what he called its “wish to limit” the role of lawmakers inside process.
however May won a key vote in parliament on Tuesday that has a compromise on plans to give lawmakers a ‘meaningful’ vote later This kind of year on the terms of Britain’s exit via the EU.
The pound strengthened 0.3 percent against the dollar to $1.3424 after parliament voted to back the government on several amendments to the EU withdrawal bill. of which also hit a two-day high versus the euro of 87.78 pence.
Earlier on Tuesday markets shrugged off weaker-than-expected wage growth data, the latest sign of protracted weakness inside British economy.
Several companies have announced store closures as well as job cuts, while poor industrial production output numbers published on Monday hit sterling.
Those developments are likely to lower expectations of a Bank of England interest rate rise in August, given the central bank has said of which wants to see more wage pressures before of which increases borrowing costs.
Money markets currently cost in a 44 percent chance of a 25 basis point hike in August.