LONDON Dec 1 Sterling bounced to an
almost three-month high in trade-weighted terms on Thursday
after Brexit minister David Davis said Britain would consider
making payments to the EU budget in return for access to EU
Traders read that as another major crack in the "hard
Brexit" line from the government that drove sterling below $1.20
in October and the pound jetted to a three-week high of $1.2644
It rose to its highest since Sept. 9 at 84.11 pence per euro
and was also at its strongest against the Bank of England's
trade-weighted broader measure for the currency at 78.3.
"These headlines suggesting Britain may be able to access
the single market are generating substantial sterling demand
from traders and investors looking to reduce their short
positions and unwind hedges," said Neil Jones, head of FX hedge
fund sales at Mizuho.
(Reporting by Patrick Graham, Jamie McGeever and John Geddie)