What Three Years of Brexit and Theresa May Meant for the Pound
Throughout three turbulent years in British politics, sterling’s peaks and troughs tended to mirror the fortunes of Prime Minister Theresa May.
The twists and turns of the Brexit process led to wild swings. At times investors traded sterling like one of its emerging-market currencies. Sometimes they refused to trade it at all. At one point the pound touched its lowest level against the dollar in over thirty years.
May’s time in office ran out with her mission to leave the EU still incomplete. Here is the story of her tenure—as told by the pound.
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
2016
July
A
“Brexit means Brexit”
May emerges as sole contender to replace David Cameron as prime minister.
S
BOE cuts rates
Pound drops the most in four weeks after interest rates are cut for the first time in seven years.
O
Flash crash
Sterling hits its lowest level since 1985, dropping 6.1% in a few minutes after an unexplained “flash crash.”
N
Pledge to Parliament
The pound jumps the most since 1993 as May offers to give both houses of Parliament a vote on any final Brexit deal.
D
2017
J
F
M
Article 50 triggered
May starts the two-year Brexit process. Sterling fluctuates, dropping as much as 0.5%.
A
May calls snap election
The pound jumps to a six-month high versus the dollar as May eyes a large increase to her parliamentary majority.
Snap election fail
May loses the majority, making it far trickier to get a Brexit deal through Parliament.
J
J
Florence speech
May says she plans to seek a two-year Brexit transition period, but traders find her speech short on details. Moody’s cuts Britain’s credit rating.
A
S
O
Veto granted
Sterling rallies after lawmakers defeat May to guarantee themselves a “meaningful vote” on the final deal.
N
D
2018
J
Transition deal agreed
Pound rallies 1% as the U.K.’s David Davis and Brussels’ Michel Barnier confirm a transition deal.
F
M
A
M
Peak pound
Sterling hits what will be its highest level during May’s tenure. Progress in Brexit talks spurs speculation of an interest-rate hike.
Johnson out
Foreign Secretary Boris Johnson and Brexit Secretary David Davis resign in protest at May’s new plan for a softer Brexit. Concerns about May’s leadership increase.
J
J
A
S
Raab distaste
May strikes a deal with Brussels, boosting the pound to the strongest level since April. Then Brexit Secretary Dominic Raab quits, and sterling slides the most in more than 17 months.
Vote deferred
Facing a crushing defeat, May scraps plans for a vote on the deal in Parliament. She pledges to go back to Brussels to seek “assurances.” Sterling hits its lowest point since April 2017.
D
2019
J
Record defeat
May’s deal gets roundly rejected by lawmakers on all sides of the house.
F
M
Brexit extended
A six-month extension does little to clear up the Brexit uncertainty, leaving traders nonplussed. May starts talks with the opposition Labour Party.
May resigns
One final pitch to lawmakers falls flat, and May announces she’ll step down—leaving the currency around 3% lower than the day she started. Boris Johnson emerges as an early favorite to replace her, putting a no-deal exit back in play and the pound’s value in limbo.
M
Leadership race
Johnson and Hunt both talk tough about a no-deal Brexit, and the market grows increasingly fearful of an Oct. 31 crash-out. Sterling touches its lowest level in more than two years as analysts talk of parity with the dollar.
J
J
MAY STEPS DOWN AS PRIME MINISTER ON JULY 24
$1.20
▼
$1.25
▼
$1.30
▼
$1.35
▼
$1.40
▼
$1.45
▼
2016
July
A
“Brexit means Brexit”
May emerges as sole contender to replace David Cameron as prime minister.
S
BOE cuts rates
Pound drops the most in four weeks after interest rates are cut for the first time in seven years.
O
Flash crash
Sterling hits its lowest level since 1985, dropping 6.1% in a few minutes after an unexplained “flash crash.”
N
D
Pledge to Parliament
The pound jumps the most since 1993 as May offers to give both houses of Parliament a vote on any final Brexit deal.
2017
J
F
M
Article 50 triggered
May starts the two-year Brexit process. Sterling fluctuates, dropping as much as 0.5%.
A
May calls snap election
The pound jumps to a six-month high versus the dollar as May eyes a large increase to her parliamentary majority.
M
Snap election fail
May loses the majority, making it far trickier to get a Brexit deal through Parliament.
J
J
Florence speech
May says she plans to seek a two-year Brexit transition period, but traders find her speech short on details. Moody’s cuts Britain’s credit rating.
A
S
Veto granted
Sterling rallies after lawmakers defeat May to guarantee themselves a “meaningful vote” on the final deal.
O
N
D
2018
J
F
Transition deal agreed
Pound rallies 1% as the U.K.’s David Davis and Brussels’ Michel Barnier confirm a transition deal.
M
Peak pound
Sterling hits what will be its highest level during May’s tenure. Progress in Brexit talks spurs speculation of an interest-rate hike.
A
M
No rate increase
Governor Mark Carney and his BOE colleagues fail to deliver a rate hike. Sterling falls 7% from its peak.
J
Johnson out
Foreign Secretary Boris Johnson and Brexit Secretary David Davis resign in protest at May’s new plan for a softer Brexit. Concerns about May’s leadership increase.
J
A
S
Vote deferred
Facing a crushing defeat, May scraps plans for a vote on the deal in Parliament. She pledges to go back to Brussels to seek “assurances.” Sterling hits its lowest point since April 2017.
Raab distaste
May strikes a deal with Brussels, boosting the pound to the strongest level since April. Then Brexit Secretary Dominic Raab quits, and sterling slides the most in more than 17 months.
O
N
D
2019
Record defeat
The pound whipsaws after May’s deal is roundly rejected by the House of Commons. Sterling steadies after dropping 1.5%. Traders try to grasp whether a no-deal exit, or indeed no Brexit at all, is now more likely.
J
F
M
Brexit extended
A six-month extension does little to clear up the Brexit uncertainty, leaving traders nonplussed. May starts talks with the opposition Labour Party.
A
May resigns
One final pitch to lawmakers falls flat, and May announces she’ll step down—leaving the currency around 3% lower than the day she started. Boris Johnson emerges as an early favorite to replace her, putting a no-deal exit back in play and the pound’s value in limbo.
M
Leadership race
Johnson and Hunt both talk tough about a no-deal Brexit, and the market grows increasingly fearful of an Oct. 31 crash-out. Sterling touches its lowest level in more than two years as analysts talk of parity with the dollar.
J
J
MAY STEPS DOWN AS PRIME MINISTER ON JULY 24
2016
“Brexit means Brexit”
May emerges as sole contender to replace David Cameron as prime minister.
July
A
BOE cuts rates
Pound drops the most in four weeks after interest rates are cut for the first time in seven years.
S
O
Flash crash
Sterling hits its lowest level since 1985, dropping 6.1% in a few minutes after an unexplained “flash crash.”
N
D
2017
Pledge to Parliament
The pound jumps the most since 1993 as May offers to give both houses of Parliament a vote on any final Brexit deal.
J
F
M
Article 50 triggered
May starts the two-year Brexit process. Sterling fluctuates, dropping as much as 0.5%.
A
May calls snap election
The pound jumps to a six-month high versus the dollar as May eyes a large increase to her parliamentary majority.
M
J
Snap election fail
May loses the majority, making it far trickier to get a Brexit deal through Parliament.
J
Florence speech
May says she plans to seek a two-year Brexit transition period, but traders find her speech short on details. Moody’s cuts Britain’s credit rating.
A
S
Veto granted
Sterling rallies after lawmakers defeat May to guarantee themselves a “meaningful vote” on the final deal.
O
N
D
2018
J
F
M
Transition deal agreed
Pound rallies 1% as the U.K.’s David Davis and Brussels’ Michel Barnier confirm a transition deal.
A
Peak pound
Sterling hits what will be its highest level during May’s tenure. Progress in Brexit talks spurs speculation of an interest-rate hike.
M
No rate increase
Governor Mark Carney and his BOE colleagues fail to deliver a rate hike. Sterling falls 7% from its peak.
J
J
Johnson out
Foreign Secretary Boris Johnson and Brexit Secretary David Davis resign in protest at May’s new plan for a softer Brexit. Concerns about May’s leadership increase.
A
S
O
Vote deferred
Facing a crushing defeat, May scraps plans for a vote on the deal in Parliament. She pledges to go back to Brussels to seek “assurances.” Sterling hits its lowest point since April 2017.
Raab distaste
May strikes a deal with Brussels, boosting the pound to the strongest level since April. Then Brexit Secretary Dominic Raab quits, and sterling slides the most in more than 17 months.
N
D
2019
Record defeat
The pound whipsaws after May’s deal is roundly rejected by the House of Commons. Sterling steadies after dropping 1.5%. Traders try to grasp whether a no-deal exit, or indeed no Brexit at all, is now more likely.
J
F
M
Brexit extended
A six-month extension does little to clear up the Brexit uncertainty, leaving traders nonplussed. May starts talks with the opposition Labour Party.
May resigns
One final pitch to lawmakers falls flat, and May announces she’ll step down—leaving the currency around 3% lower than the day she started. Boris Johnson emerges as an early favorite to replace her, putting a no-deal exit back in play and the pound’s value in limbo.
A
Leadership race
Johnson and Hunt both talk tough about a no-deal Brexit, and the market grows increasingly fearful of an Oct. 31 crash-out. Sterling touches its lowest level in more than two years as analysts talk of parity with the dollar.
M
J
J
MAY STEPS DOWN AS PRIME MINISTER ON JULY 24
2016
July
“Brexit means Brexit”
May emerges as sole contender to replace David Cameron as prime minister.
A
S
Flash crash
Sterling hits its lowest level since 1985, dropping 6.1% in a few minutes after an unexplained “flash crash.”
O
N
Pledge to Parliament
The pound jumps the most since 1993 as May offers to give both houses of Parliament a vote on any final Brexit deal.
D
2017
J
F
M
Article 50 triggered
May starts the two-year Brexit process. Sterling fluctuates, dropping as much as 0.5%.
A
May calls snap election
The pound jumps to a six-month high versus the dollar as May eyes a large increase to her parliamentary majority.
Snap election fail
May loses the majority, making it far trickier to get a Brexit deal through Parliament.
J
J
Florence speech
May says she plans to seek a two-year Brexit transition period, but traders find her speech short on details. Moody’s cuts Britain’s credit rating.
A
S
Veto granted
Sterling rallies after lawmakers defeat May to guarantee themselves a “meaningful vote” on the final deal.
O
N
D
2018
J
F
Transition deal agreed
Pound rallies 1% as the U.K.’s David Davis and Brussels’ Michel Barnier confirm a transition deal.
M
A
Peak pound
Sterling hits what will be its highest level during May’s tenure. Progress in Brexit talks spurs speculation of an interest-rate hike.
M
J
Johnson out
Foreign Secretary Boris Johnson and Brexit Secretary David Davis resign in protest at May’s new plan for a softer Brexit. Concerns about May’s leadership increase.
J
A
S
O
Raab distaste
May strikes a deal with Brussels, boosting the pound to the strongest level since April. Then Brexit Secretary Dominic Raab quits, and sterling slides the most in more than 17 months.
N
D
Vote deferred
Facing a crushing defeat, May scraps plans for a vote on the deal in Parliament. She pledges to go back to Brussels to seek “assurances.” Sterling hits its lowest point since April 2017.
2019
J
Record defeat
May’s deal gets roundly rejected by lawmakers on all sides of the house.
F
Brexit extended
The EU hands May an extension to Oct.
M
A
May resigns
One final pitch to lawmakers falls flat, and May announces she’ll step down.
M
Leadership race
Johnson and Hunt both talk tough about a no-deal Brexit, and the market grows increasingly fearful of an Oct. 31 crash-out. Sterling touches its lowest level in more than two years as analysts talk of parity with the dollar.
J
J
May steps down as prime minister on July 24