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The pound is still loosening, pessimistic about a post-Brexit trade deal

11/12/2020
Source : zonebourse.com
Categories: Economy/Forex

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 Sterling weakened further on Friday against the dollar and the euro, a day after a more severe fall, after Boris Johnson said it was "very, very likely" that talks with the European Union would fail on a deal governing their post-Brexit relationship.

Around 20:10 GMT, the British currency was down 0.56% against the greenback at 1.3221 dollar, after touching 1.3135 dollar in the early morning, a low since November 13.

At the same time, it dropped 0.35% against the European single currency to 91.62 pence per euro, after plummeting to 92.30 pence per euro, a rate more seen since 15 September.

Falling since the beginning of the European session, the pound sterling saw its fall accelerate after the statements of the British Prime Minister during a visit to Blyth, in the north of England, before recovering a little in New York.

"It's very, very likely that we'll have to pick a solution that would be, I think, great for the UK and we could do exactly what we want from 1 January," Mr Johnson said.

"Johnson's latest warning has pushed the pound below $1.3150," Thinkmarkets' Fawad Razaqzada told AFP.

"It seems that traders are not taking any risks now that the weekend is approaching," he added.

The same goes for Western Union, where Joe Manimbo believed that brokers had "abandoned the pound on Friday, fearing that it would be significantly cheaper if the Brexit negotiations collapse completely over the weekend".

Earlier in the day, European Commission President Ursula von der Leyen told the leaders of the 27 that hopes for an agreement with London on the future trade relationship were "low", according to several participants interviewed by AFP.

"Relations between the United Kingdom and the European Union have gone from bad to worse in the last 24 hours, and this also applies to the pound sterling," David Madden of CMC Markets told AFP.

The two parties have given themselves until Sunday to decide on the terms of their divorce.

The dollar strengthened at the same time on Friday against the euro, the day after the last meeting of the year of the 25 members of the Governing Council of the European Central Bank (ECB).

The European currency gave up 0.19% against the greenback, at 1.2115 dollar.

 

  Friday Classes Thursday Classes

20H10 GMT 22H00 GMT

EUR/USD 1.2115 1.2138

EUR/JPY 126.03 126.52

EUR/CHF 1.0776 1.0754

EUR/GBP 0.9162 0.9129

USD/JPY 104.03 104.24

USD/CHF 0.8895 0.8860

GBP/USD 1.3221 1.3295
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