​The pound fell on Tuesday after the UK Supreme Court ruled that the Government must hold a parliamentary vote to trigger the start of official negotiations to exit the European Union.

The decision rejects the Government’s argument that Prime Minister Theresa May can use her executive powers, known as “royal prerogative”, to invoke Article 50 of the EU's Lisbon Treaty and kick-start two-year divorce proceedings.

“So any change in the law to give effect to the referendum must be made in the only way permitted by the UK constitution, namely by an Act of Parliament,” said David Neuberger, President of the Supreme Court.

The pound was trading at $1.246, down around 0.6 per cent on the day after the ruling. Before the judgment sterling was above $1.25, at a five-week high.

The currency rebounded slightly trading just above $1.25 at market closing time.

“Though there will be some cheer among those with lingering hopes for a delayed Brexit, today’s decision represents a marginal delay, at most,” said Geoffrey Yu, head of the UK Investment office at UBS Wealth Management.

“A prolonged sense of uncertainty does not mean Brexit will not happen, and we expect that Article 50 will be triggered in March regardless,” he added.

Sterling has endured a bumpy ride in recent months but has largely edged higher over the past week spurred by Ms May in a speech last Tuesday offering markets some clarity on her vision for Brexit.

That strength coincided with a fall in the dollar, triggered by concerns over US President Donald Trump's policies and his protectionist agenda just days after his inauguration.

HSBC strategists said in the lead-up to Tuesday’s Supreme Court decision that this had been the most likely outcome and that the Government was likely to be “prepared for this”.

What does the falling pound mean for you?

“It should be able to table a short and simple parliamentary bill in the coming days, again increasing the prospect of Article 50 being triggered before the end of March,” they said.

David Meier, an economist at Swiss bank Julius Baer, meanwhile, said that passing a bill should be a formality and would not force Ms May to reconsider her “hard Brexit” plans, so it would unlikely have a huge impact on markets.

“May would hardly have presented 'hard Brexit' plans if she had had doubts about her party’s support,” he said.

The FTSE 100, which is packed full of multinational exporters that generate vast revenues abroad and therefore tends to rise when the pound falls, climbed moderately after the ruling.

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Nonetheless, many experts forecast that this is unlikely to spell an end to the months-long period of volatility that has buffeted currency market.

The currency has fallen about 17 per cent against the dollar since the UK voted to leave the EU in June’s referendum. It is one of the worst-performing currencies in the world for the period and remains incredibly volatile.