City economists predict more with more uncertainy and volatility in currency and stock markets but are struggling to judge what the Article 50 ruling will mean for the economy.

After the news that Parliament will get to vote on Brexit, the UK-focused FTSE 250 rose 1.6 per cent, the blue-chip FTSE 100 index of multinationals slid to 6,808 before regaining the day’s losses, while the pound jumped to a three-week high of $1.24.

Number 10 has said the decision will not change the Article 50 timetable but the markets now see a “hard Brexit” as less likely, giving a short-term boost to the country's economic prospects.

Most economists agree that uncertainty looks set to looks set to reign as the Government mounts an appeal against the decision.

Howard Archer of IHS Markit Insight said: “obviously, Brexit is still highly likely to happen. But there is now a lot more uncertainty about what will happen in the near term given that the government is appealing the ruling. A general election in 2017 may now also be more likely, fuelling further uncertainty, he said.

However, he added that the decision would be positive for markets. “There will be the perception that a parliamentary vote on triggering Article 50 will increase the chances of a less hard Brexit than we had seemingly been increasingly headed for in recent weeks. This may give a lift to business confidence.” A lift in business confidence would give a much-needed boost to the pound, he added.

Martin Arnold, of ETF Securities agreed that today's ruling would give “fresh impetus” to the pound. The lessened likelihood of a hard Brexit “will be less damaging for the UK economy,” leading to more optimistic investors, he said.

However, he cautioned that “volatility is likely to remain a feature for currency markets, with an appeal by the government likely.“

Neil Wilson of ETX Capital said the decision would “underpin sterling for some time”, adding, “we could see this create a floor under the pound around $1.25. Politics and uncertainty continue to drive the currency markets,” he said.

Others saw the boost to the pound as a temporary one. saw, “the pound was due some good news, and it has certainly taken advantage of this brief glimmer of hope,” Connor Campbell of SpreadEx said.

Citigroup agreed that backing out of Brexit still remains unlikely, but markets are pricing in a remote chance of that eventuality: “MPs room for manoeuvre at that stage would be constrained by the alternative available, ie. whether rejection means continued EU membership or “hard Brexit” without any deal at all.”

The bank welcomed the fact that Brexit could now be less damaging: “A final ruling by the Supreme Court that parliament gets to vote on Article 50 would set a precedent and perhaps also lead to more parliamentary involvement and even votes during the negotiation process.”

For the FTSE 100, which has rallied since the Brexit vote, most see the outlook bleaker as the pound rallies.

Zeg Choudhry, managing director at LONTRAD, told Reuters: “The potential for the market to fall reasonably sharply has increased. The decision has given another down draft,” to the index.

Financial Times correspondent Jim Pickard summed up the mood: