Theresa May's announcement yesterday that she intended to work with the Labour Party to reach a Brexit deal has helped the pound rise.
The currency is up 0.3% at $1.3187 after falling through $1.30 on Friday when the market had been worrying about a no-deal Brexit.
Three dimensional chess
BBC Radio 5 Live
Simon French, chief economist of Panmure Gordon, tells Wake Up To Money that the pound rallied yesterday after Theresa May said she wanted to meet Labour leader Jeremy Corbyn to agree a plan on the future relationship with the EU.
"The pound, which has been a decent bellwether of what financial markets think, rallied... just under a cent on the news last night," he said.
But the outcome was not clear: "This is three dimensional chess".
The pound is now down more than 0.3% against the dollar at $1.3115 amid uncertainty about Brexit.
The fall comes as Theresa May appears to be getting ready to have a third meaningful vote on her Brexit deal.
Pound lacks direction
The pound has slipped against the dollar ahead of the vote by MPs on Brexit options, scheduled to take place place later today.
It is down slightly at $1.3195 and is little changed against the euro.
sterling, there is precious little to drive directional trading," said Neil Wilson, chief market analyst, at markets.com.
He points out the currency is trading in the $1.3180 region - the 50%
retracement of the 2016-2018 trough-to-peak rally.
Much of the focus in the currency markets has been in the New Zealand currency which has dropped after the central bank signalled it may cut interest rates in May.
just plays into the view that globally central banks are pivoting towards
easing having been bent on tightening in 2018," he said.
Pound edges higher
The pound has lifted off the day's lows following the higher than expected rise in retail sales.
"February's retail sales figures shows that the improving trend in retail wages, and not the uncertainty created by the Brexit saga, is the dominant influence on households' spending on present," said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.
Why hasn't the pound moved more?
BBC Radio 4
Movements in the pound are a focus for the markets during the Brexit debates in parliament. It is up 4% this year.
George Godber of Polar Capital told BBC Radio 4's Today Programme that there "could be a big shift in sterling next week".
For now, he said: "No one knows what's going on so you get very jumpy events but [the markets] keep focusing back on the chance of a no-deal being highly unlikely".
The pound could reach $1.40 and $1.50 if there is a deal, he said. "If we end up crashing out with no-deal I expect sterling to be down to $1.20".