British pound surges as May wins positive vote
The pound rose against both euro and the dollar yesterday as early reports said that May, British Prime Minister would easily defeat a move to depose her.
May survives confidence vote by 200 votes to 117 last night, to stay on as prime minister – but more than a third of Conservative MPs voted against her.
Sterling jumped as high as $1.2672 as the result came in but then fell to $1.2605, up 1pc on the day after the number of lawmakers that had voted against Mrs May was announced.
Mrs May will still have to put her withdrawal agreement to parliament, where it would likely be voted down, investment bank ING said.
Britain’s European partners have said they will not make any changes to the withdrawal agreement, which means Mrs May stands no chance of winning over Brexit hardliners.
“The pound is trading on exceptionally high volatility at the moment and a rudderless UK government at this vulnerable time could see the Bank of England’s Broad Sterling Trade Weighted Index fall back to the lows seen in 2008 and 2016 – effectively a 3pc decline from current levels.”
Irish shares posted a modest gain, adding 0.57pc by the close of trading, although even a negotiated exit would still hit the economy here hard.
The ESRI yesterday warned that a no-deal Brexit would hit growth hard, while also cautioning that the Government must take action on overspending.