Pound Sinks to Lowest Since 2017 on Threat of No-Deal Brexit

  • The pound fell to the lowest since 2017 as the market once again reckoned with no-deal Brexit risk after the contenders to be U.K. prime minister toughened their rhetoric.
  • Sterling hit its weakest level in more than two years versus the dollar and a six-month low against the euro, as Brexit negotiations appeared to turn more hostile.
  • Both leadership contenders Boris Johnson and Jeremy Hunt have said the so-called backstop plan to avoid a hard border in Ireland, considered essential by Brussels, would need to be scrapped.
  • The U.K. currency extended its slide after Sky News reported that Johnson’s team was considering sending lawmakers home for up to two weeks in October to prevent them from blocking a no-deal Brexit.
  • After a strong start to the year, the pound is the worst performer in the Group-of-10 in recent months and is at the lowest ever for this time of year.

(Source: Bloomberg)