A no-deal Brexit may appear to be the most likely scenario
It's almost a given now that May will announce that she will pull the vote tomorrow when she makes her statement in parliament later, but where does that leave us? The reason she is doing so is to buy time to renegotiate things with European officials and it is said she will travel to Brussels later this week to meet with EU leaders in conjunction with the final EU summit of the year.
Do note that the agenda has nothing on Brexit so I'm not sure how May is going to seek any changes from European officials on the agreement over the next few days. Not only that, the UK parliament goes into recess on 20 December which leaves May with very little time to even head out to renegotiate anything and come back in time for another vote; unless she plans to see it move into 2019 which presents yet another headache.
To make matters worse, European officials have been clear today that they will not be willing to renegotiate the agreement. The pound was a wavering a little when headlines crossed that May will pull the vote but it basically sank after the European Commission said that they won't listen to any changes that May is wanting to put forth.
With parliament losing further confidence in Theresa May and her Brexit deal very much likely to be rejected still, it leaves us with the likely scenario where it's either going to be a general election, a no-deal Brexit, or revoking Article 50.
The latter is the only option in which the pound can see gains and it remains a very unlikely one that will play out. With the other two options being the more likely ones to occur, it suggests that there's more downside than upside for the pound from here.
