Pound Rebounds As U.K. PM May Pledges To Fight Vote On Leadership

The pound climbed against its major counterparts in the early European session on Wednesday, after U.K. Prime Minister Theresa May asserted that she would battle no confidence vote on her leadership, scheduled to be held at the House of Commons today evening.

The PM will be thrown out of power if 158 of her 315 Conservative MPs vote against her.

The ballot will be held between 6-8 pm this evening and the votes will be counted shortly after.

Graham Brady, the chair of the powerful 1922 committee, called a vote of no confidence in the PM after 48 letters seeking a leadership contest have been submitted to him.

Shortly after the announcement of no confidence vote, May said that she would fight for her leadership with everything she has got.

Investor sentiment also lifted up amid optimism about U.S.-China trade talks.

The resumption of talks between the U.S. and China and Donald Trump's positive remarks about a deal being struck buoyed global shares.

The currency has been trading higher against its major rivals in the Asian session, excepting the euro.

The pound advanced to 0.9025 against the euro, following a decline to a session's low of 0.9069 at 2:30 am ET. The next possible resistance for the pound is seen around the 0.89 region.

Figures from Eurostat showed that Eurozone's industrial production grew in October after a slump in the previous month.

Industrial production rose 0.2 percent from September, when it declined 0.6 percent, which was revised from 0.3 percent. The growth was in line with economists' expectations.

Having dropped to an 8-month low of 1.2477 against the greenback at 2:35 am ET, the pound reversed direction and reached as high as 1.2551. The pound is seen finding resistance around the 1.27 level.

The pound appreciated to 1.2462 against the franc, after falling to 1.2395 at 5:00 pm ET. If the pound rises further, 1.26 is possibly seen as its next resistance level.

Reversing from an early 2-day low of 141.51 against the yen, the pound edged up to 142.40. The pound is likely to find resistance around the 144.00 level.

Data from the Bank of Japan showed that Japan producer prices fell 0.3 percent on month in November.

That missed expectations for a decline of 0.1 percent following the 0.4 percent increase in October.

Looking ahead, U.S. CPI for November and monthly budget statement for November are scheduled for release in the New York session.