Hard Brexit Weigh on the Pound Currency

Hard Brexit Weigh on the Pound Currency

The pound currency struggles in today’s trading against other currencies. Fears of a no-deal Brexit bothers sterling traders and investors.

British Pound futures loses 0.75% or 0.0095. The GBP/USD exchange pair went down 0.79% or 0.0100 points, trading at 1.12417 USD compared to its last close of 1.2514 USD.

The EUR/GBP rose as the single currency takes advantage of the weakening sterling. The pair inched 0.52% or 0.004 points, trading at £0.9039 compared to its previous close of £0.8993.

The pound currency received much pressure after investors in Britain worry more about the next British Prime Minister.

A currency strategist said that the common currency is also being weighed by the sterling who is suffering from news regarding Brexit.

The current leading candidate for the British Prime Minister race is Boris Johnson. Johnson is known to support a no-deal Brexit outcome and continuously promises the UK a plan after a no-deal Brexit.

If Johnson wins the Conservative party leadership contest, he is set to sit as the next BPM before the month ends.

Investors also worry about the poor economic date showed by the Bank of England, fearing that it could potentially signal a cut in interest rates.

In the past, pound currency investors were expecting a raise from the BoE, but current status and signs say otherwise.

More on Brexit

The main burden of the pound currency is the Brexit. Three years ago, a historic referendum held the vote which decided the United Kingdom’s exit from the European Union.

The Brexit has set the United Kingdom in the middle of a political crisis.

Britain was initially set to leave the EU on March 29, but the date later got extended twice.

The former British Prime Minister later resigned and now, Jeremy Hunt and Boris Johnson are the two candidates hoping to win the BPM post. The two candidates vowed to the UK a no-deal Brexit.

Just recently, Boris Johnson admitted that he mishandled some of the information that was leaked that consequently lead Kim Darroch’s resignation.

Darroch, a former UK ambassador to the United States, quitted after his diplomatic cables were allegedly leaked.

Despite Johnson’s fault, the Troy party and voters continued to support him.

The promise of the two hopefuls have received heavy criticisms and warning from British officials and Investors.

People are worried about a no-deal Brexit that could potentially damage the United Kingdom’s economy; the pound currency’s fall, the loss of numerous jobs and trigger a recession.

Other Pound Exchange Pairs

The sterling also lost against other currencies. The GBP/CHF exchange rate went down 0.38% or 0.00476 points, it currently trades at £1.2273 compared to its last close of 1.2272.

The GBP/AUD pair saw a decline as the Australian dollar sees an opening for gains against the pound currency. The exchange pair lost 0.58% points or 0.00103 and is presently trading at £1.7671.

The Canadian dollar also saw an opportunity from the exhausted sterling. The GBP/CAD pair declined 0.84% or 0.0138 points, trading at £1.6189 compared to its previous close of £1.6327.