Pound Pares Losses Ahead of Brexit Vote
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Analysts say it appears unlikely the U.K. would exit the EU without formal pact.
The British pound advanced against the U.S. dollar Wednesday, paring its losses from the prior day when U.K. lawmakers rejected Prime Minister Theresa May’s Brexit divorce deal for a second time.
The pound gained about 1.1% against the dollar to 1.3224 in recent trading, according to FactSet.
Though the defeat intensified political and business uncertainty in the country, analysts said it appeared unlikely that the U.K. would exit the European Union without a formal pact, spurring a rally in the pound.
“The most likely scenario is an extension of the March 29th deadline, which should provide a short-term boost to the British currency,” wrote Brendan McKenna, a currency strategist at Wells Fargo Securities, in a note Wednesday. March 29 is the date that Britain is supposed to separate from the EU.
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