The pound rallied after European Union chief Brexit negotiator Michel Barnier reportedly said that it is "realistic" and "possible" to reach an agreement with the U.K. by late October or early November on its withdrawal from the bloc.
With Britain set to leave the EU in March 2019, Barnier said both sides must reach a Brexit agreement before the start of November to allow for its timely ratification by the U.K. House of Commons, the European Parliament and the European Council.
"I think that if we are realistic we are able to reach an agreement on the first stage of the negotiation, which is the Brexit treaty, within six or eight weeks," Barnier told a forum in Slovenia, according to an excerpt reported by Sky News and Reuters.
Barnier's remarks were also reported on Twitter by the British Embassy in Slovenia.
The pound was up 0.84% at $1.3028 by 11:26 a.m. ET after earlier reaching a five-week high of $1.3052. It was also trading 0.37% higher against the euro at €1.1223.
Barnier has been striking an optimistic tone on Brexit in recent weeks, saying that the EU is prepared to offer the U.K. an unprecedentedly close partnership after it leaves, and that he is open to a variety of solutions to the Irish border issue, a major hurdle in the negotiations.
The Guardian reported that EU leaders are expected to announce next week that an extraordinary Brexit summit will take place in November to give further encouragement to Barnier to reach a deal with the U.K.