December 4, 2018 / 6:15 PM / 10 days ago

Pound hits 2018 lows then recovers as parliament gets more Brexit say

Wads of British Pound Sterling banknotes are stacked in piles at the Money Service Austria company's headquarters in Vienna, Austria, November 16, 2017. REUTERS/Leonhard Foeger

LONDON (Reuters) - Sterling briefly hit 17-month lows on Tuesday before recovering after a parliament vote gave UK lawmakers more power over the next Brexit steps if Prime Minister Theresa May’s European Union withdrawal deal is voted down.

The currency earlier tumbled as May’s government was found to be in contempt of parliament for refusing to release its full legal advice on Brexit, but it then rebounded after the second vote.

That vote could force the government to give parliament an increased say over Brexit and neuter the threat May has been using to persuade lawmakers to back her deal: that if they don’t, Britain could leave the block without any deal.[nS8N1VQ048].

The pound touched a low of $1.2659, down around half a percent on the day, then rose to $1.2714 to trade more or less flat. Against the euro it plumbed the lowest since Sept 25 at 89.450 pence before rising to 89.165 pence.

Reporting by Sujata Rao and Tommy Wilkes

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