The value of the pound against the euro has held today, after only having just slightly recovered following the leadership challenge on Wednesday night. The rate is now €1.1114 according to Bloomberg figures, while yesterday the pound rose against the euro at €1.110. The steady value of sterling comes as Theresa May returns to Brexit negotiations, with her fellow MPs warning the party could fall apart over its division on their confidence in the Prime Minister. On Thursday the markets saw the pound rise thanks to the Prime Minister’s comeback and it has so far remained steady.
Laura Parsons, market analysis expert at TorFx told Express.co.uk: “After a volatile week, the pound to euro exchange rate is just about holding above €1.110.
“The pound was unable to benefit from yesterday’s dovish European Central Bank (ECB) rate decision however, with all eyes still on Prime Minister Theresa May and her Brexit deal.
“With no more UK data until next week, Brexit headlines will be responsible for any final flurries of GBP movement before the weekend.”
The leadership challenge came after 48 MPs started the secret ballot as they did not agree with May’s current Brexit deal.
Following her win, Theresa May said: “I am pleased to have received the backing of my colleagues in tonight’s ballot.
“Whilst I am grateful for that support, a significant number of colleagues did cast a vote against me and I have listened to what they said.”
May travelled to Brussels yesterday to continue working on the deal which will see the UK leave the EU in March 2019. She joined the EU summit to discuss the contentious Irish backstop. The pound to euro exchange rate is likely to continue fluctuate over the next few uncertain months, as the Brexit deal continues to develop.
Laura explained earlier this week how the pound could struggle to pick up.
“News that EU leaders are ruling out the possibility of the Brexit deal being renegotiated weighed on the British currency and the uncertainty will keep the pound under pressure as the week continues,” she said on Wednesday.
The pound dropped ahead of the vote of no-confidence at the start of this week, with Mrs May saying that changing Conservative leader would “put our country’s future at risk and create uncertainty when we can least afford it”.
She went on to claim that further political upheaval could lead to Brexit being delayed or stopped altogether.
The Prime Minister said: “I’ve been a member of the Conservative party for 40 years, as an activist, councillor, shadow minister, home secretary, and now prime minister.”
Sir Graham said: “The threshold of 15 percent of the parliamentary party seeking a vote of confidence in the leader of the Conservative Party has been exceeded.”
The vote left the value of the pound in a state of uncertainty of Wednesday.
Hamish Muress, currency analyst at OFX, said: “Theresa May’s decision to fight for her job has left the pound in a state of limbo.
“Uncertainty is the word of the day. The prospect of a general election would not be good news, and it’s no secret that sterling strives for stability.”