FILE PHOTO: An employee is seen walking over a mosaic of pound sterling symbols set in the floor of the front hall of the Bank of England in London, Britain 25, 2008. REUTERS/Luke MacGregor/File Photo

LONDON (Reuters) - Sterling gained half a percent versus the dollar and euro on Tuesday after Ireland’s RTE News reported that the European Union may offer Britain a UK-wide customs union.

The pound rose from just below $1.30 GBP=D3 to as high as $1.3044 after the report, up 0.6 percent on the day. It also jumped versus the euro to as much as 87.995 pence before easing back to 88.1 pence EURGBP=D3.

Reuters had reported on Monday that EU negotiators were looking at ways to promise Britain a customs deal.

Analysts said the EU offering a UK-wide customs union would show that the two sides were moving closer towards resolving their differences and reaching a Brexit deal, although such a proposal would not be popular among some of May’s colleagues in her Conservative party.

May’s spokesman also said on Tuesday that the British leader was confident she could get a Brexit deal that will win the support of parliament.a