The British pound is under further pressure today and many analysts expect further loses as the prospect of a “Hard Brexit” swirls around the markets.
At 7.00pm (GMT) the British currency was trading at $1.2638 against its US counterpart, down from $1.2745 in yesterday’s trading.
The pound has been in freefall ever since British Prime minister Theresa May Announced last week in a conference that the timing for triggering article 50 which will put in motion the strategy for Britain to leave the European Union will happen no later than the end of March next year.
Many have dubbed the move “Hard Brexit” which means that the UK is not ready for the move and the effects have not been fully priced into the market.
“The Tory Party conference is turning into a sell for the pound, as foreign exchange traders get spooked by May’s apparent sanguine attitude to leaving the single market, preferring to focus on immigration and UK sovereignty rather than the economic fallout of Brexit.” Noted Kathleen Brooks, research director City Index
German Chancellor has also added fuel to the fire by announcing that if Britain would like to remain in the single market they would have to keep the borders open for free movement of travel which is exactly why the country voted to leave the EU in the first place.
Strong data out of America also hurt the pound today with the initial jobless claims figure coming in above expectations which set the stage for a strong non-farm payrolls figure tomorrow causing the sterling further pain.
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