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Reuters
LONDON, Nov 13 (Reuters) – Sterling hit a 6-1 / 2 month high against the euro on Tuesday after the British cabinet office minister said the United Kingdom and the European Union were on the cusp of a Brexit deal, lifting hopes of an imminent breakthrough in talks.
The British currency had been broken down on Monday on the basis of negotiations with the UK.
David Lidington, Prime Minister Theresa May's de facto deputy, told BBC radio on Tuesday that Britain and the US were "almost within touching distance" of an agreement. He said it was still possible in the next 24 or 48 hours.
Sterling also jumped as high as $ 1.2929 from around $ 1.2870 before Lidington's comments, up more than half a percent on the day. It later extended those gains to $ 1.2980, up nearly one percent and back to levels on Friday.
Volatility in the pound has surged a Brexit discussions intensify and investors position themselves.
Investors' expectations for price swings in the pound versus the dollar over the next one and three months <GBP3MO = have soared to their highest since early 2017.
Neil Mellor, BNY Mellon, currency strategist at BNY Mellon, commented that the Northern Irish Democratic Unionist Party is still in the process
"Amid talk that this week could be the last chance to secure an agreement at this summit," Ms May's proposals are "tasked with healing", said Mellor.
The EU wants to get a deal on a draft deal by the end of the day.
Brussels diplomatic sources may fear that any delay will increase the chances of rejection by May's ministers or the British parliament.
Separately, British workers' data is less important than the rest of the world, but it was largely unmoved.
The jobless misses picked up to 4.1 percent. Economists in a Reuters poll forecast it would hold steady at 4 percent.
"In terms of reaction it has been pretty much paced with FTSE barely budging," said David Cheetham, analyst at online trading firm XTB.
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