The pound edged higher to almost $1.27 on Friday following May's announcement that she'll step down in June after failing in her bid to secure Britain's exit from the European Union.
But sterling has dropped 2.9% this month against the US dollar and is the worst performer of the world's 10 major currencies. It's also been on a losing streak against the euro, and there's little sign of the pressure easing up any time soon.
That's because whoever succeeds May as prime minister will face the same Brexit nightmare. The European Union has said it's done discussing the terms of Britain's departure. And the current deal, negotiated by May, faces seemingly insurmountable opposition in Britain's parliament.
"To borrow a phrase, nothing has changed, or at least, very little has," Edwin Morgan, the head of the Institute of Directors, a business lobby group, said in a statement. "A new leader will be faced with the same political challenges and the same economic realities."
Analysts predict that May will be replaced by a Brexit hardliner, which raises the odds of the United Kingdom crashing out of the European Union — its biggest market — without a deal to protect trade.
Lukman Otunuga, an analyst at currency trader FXTM, said May's departure just adds to "chronic uncertainty over Brexit."
"Although the pound offered a mixed reaction after May announced her resignation date, investors should fasten their seat belts as the new round of drama ahead is just starting," Otunuga said in a note.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, predicts that the United Kingdom will remain in "Brexit limbo" for at least a year.
"The necessary political support to make a decisive Brexit step — in any direction — does not exist," he said.
The pound peaked at $1.50 on the eve of the referendum in June 2016, when nearly 52% of British voters backed Brexit.
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