Economic news

Pound slumps to 2018 lows as no-deal Brexit looms

Sterling remained under pressure amid a heavy selling on Wednesday, sliding to its weakest point versus the dollar and euro in almost a year as investors digested the possibility of Britain's departure from the EU without a deal.

Photo: Reuters

The British currency dropped to as low as $1.2859 versus the dollar. It also tumbled 0.6 percent against the euro to 90.175 pence.

In case of a ‘no-deal’ Brexit, the UK's economy would be hit by raising trade barriers with the country's largest export market.

Analysts consider the UK currency was also being affected by a rising realisation that, after last week’s central banks policy meeting, UK interest rate hikes were likely to be as limited as one a year.

Sterling has slumped 10.6 percent since mid-April against its U.S. rival and is down near 5 percent year-to-date.

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