Pound dollar price falls below $1.29 on August 8 amid no deal Brexit fears

Markets
Insider

• The pound is below $1.29 for the first time since 2017
  and falling against the euro and yen.
• Sterling’s price is suffering from ongoing concerns
  about a potential no deal Brexit.
• Analysts say the currencies poor performance is likely
  to continue in the short-term.

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LONDON — The pound fell below $1.29 for the first time since
September 2017 on Wednesday as fears about a possible no-deal
Brexit continued.

Sterling
is down 0.6% against the dollar to $1.2860 at 12.00 p.m. BST
(7.00 a.m. ET). It marks an 11-month low for the pound against
the greenback. The
pound is also down 0.58% against the euro and down
0.86% against the Japanese yen.

Lukman Otunuga, a research analyst at FXTM, said in an email on
Wednesday lunchtime in London: “Concerns of a potential hard
Brexit scenario have haunted investor attraction towards the
Pound and have left the currency vulnerable to downside shocks.”

Traders are concerned about a no-deal Brexit, which would see
Britain drop out of the European Union without an agreement on
future trading relations with the bloc. This would likely cause
huge disruption for everything from food to medical supplies in
the UK.

The deadline for Britain to leave the EU is March 2019. The UK
government has so far made little progress in agreeing on a
post-Brexit trading deal with the EU.
Bank of England Governor Mark Carney and
UK International Trade Secretary Liam Fox have both warned
about the rising likelihood of a no-deal Brexit in recent weeks.

The pound has fallen almost 2% since the start of August and
Otunga warned it is likely to stay under pressure for the rest of
the week at least.

“The currency is likely to remain depressed ahead of Friday’s
second quarter UK GDP report, which could offer fresh insight
into the health of Britain’s economy,” he said. “While a solid
GDP print could throw the bruised Pound a short-term lifeline,
any meaningful gains may be obstructed by Brexit-related
uncertainty and an appreciating Dollar.”

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