Pound may rise to $1.38 in case of a Brexit transaction

Today, the sterling pound against the dollar jumped to its highest level since the end of January against the background of news implying a possible postponement of Brexit.

British Prime Minister Theresa May is ready to propose the Parliament to postpone the date of the country's withdrawal from the EU from the end of March to a later date, according to the newspaper, The Sun.

In addition, it was reported that the European Commission could consider the question of a two-year postponement of Brexit. Moreover, representatives of the Labor Party are promoting the idea of holding a second referendum.

As for Theresa May, on the eve she stated that the UK and the EU countries are set to implement Brexit without delay.

Meanwhile, according to Skandinaviska Enskilda Banken (SEB) experts, even if eventually London and Brussels reached an agreement, the problems for the pound will not end there.

"Another threat to the British currency lies in the country's weakening economy. Therefore, any pound rally is likely to be limited," the experts said.

In turn, analysts at Aberdeen Standard Investments believe that the pound could rise to $1.38 in the event of a Brexit deal. However, the UK economy will need to overcome some structural damage in order for the GBP/USD pair to consolidate above the level of 1.40.

The material has been provided by InstaForex Company - www.instaforex.com