Pound Falls As U.K. Govt. Plans To Trigger Article 50 On March 29

The pound dropped against its major counterparts in early New York deals on Monday, erasing early gains, after the U.K. government announced plans to invoke Article 50 on March 29, allowing the nation to kick start formal Brexit negotiations with the other EU members on terms of its exit.

Britain's EU ambassador, Tim Barrow, informed the office of European Council president Donald Tusk that the U.K. would submit formal letter to Brussels on the same day.

The Prime Minister will give a statement to MPs in the House of Commons next week, after pulling the Brexit trigger.

The initiation of Article 50 will enable the U.K. to work on deal with the EU, which will set the terms of its departure and future relations after leaving the bloc.

The pound was trading in a positive territory early in the European session, on expectations of UK inflation hitting 2.1 percent when the latest data is unveiled on Tuesday.

The latest survey from property tracking website Rightmove showed that the average asking prices for a house in the United Kingdom increased further in March.

House prices in England and Wales climbed 1.3 percent month-over-month in March, following a 2.0 percent rise in February.

The pound held steady against its major rivals in the Asian session, with the exception of the euro.

The pound eased to 1.2367 against the greenback and 1.2341 against the franc, from its early near 3-week high of 1.2435 and near a 2-week high of 1.2397, respectively. The next possible support for the pound is seen around 1.20 against the greenback and 1.18 against the franc.

The pound retreated to 139.52 against the yen and 0.8689 against the euro, from its early high of 140.12 and an 11-day high of 0.8659, respectively. If the pound extends slide, it may find support around 0.90 against the euro and 137.00 against the yen.

Looking ahead, German Bundesbank President Jens Weidmann is expected to speak in Loerrach at 12:45 pm ET.

Subsequently, Federal Reserve Bank of Chicago President Charles Evans is expected to speak about current economic conditions and monetary policy at the National Association for Business Economics luncheon, in New York at 1:10 pm ET.

At 2:20 pm ET, Bank of England Chief Economist Andy Haldane is scheduled to speak at the London School of Economics Public Productivity Lecture.