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Pound Sinks as Threat of No-Deal Brexit Rises

September 7, 2020 at 12:36 by Vladimir Vyun

Banknotes of ten British poundsThe Great Britain pound fell against all other most-traded currencies today as the no-deal Brexit looks more and more likely. Better-than-expected housing data released in Britain on Monday did nothing to help the currency.

According to reports, the UK government is preparing the internal market bill that will undermine parts of the Withdrawal Agreement reached between the United Kingdom and the European Union. It will complicate negotiations between the UK and the EU and can result in Britain leaving the EU without a trade deal. UK Prime Minister Boris Johnson signaled that he plans to set an October 15 deadline for a deal, after which either a deal is reached or Britain drops the negotiations. He also said that the no-deal outcome can be positive for the UK.

Meanwhile, the Halifax House Price Index showed an increase of 1.6% in August compared with July. It was noticeably better reading than an increase of 1.0% predicted by analysts.

There will be quite a few macroeconomic reports in Britain over the week, the most important of them likely being gross domestic product data released by the Office for National Statistics on Friday. Experts predicted ahead of the report that it will show a 6.6% growth of the economy in July — a slowdown from June’s 8.7% rate of growth.

GBP/USD fell from 1.3257 to 1.3167 as of 12:36 GMT today. GBP/JPY dropped from 140.82 to 139.83. GBP/CHF declined from 1.2102 to 1.2038.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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