Sterling fell more than half a percent to this morning after Prime Minister Theresa May returned from a visit to Brussels, where she attempted to win assurances from the European Union over her Brexit withdrawal agreement.
The trip, which has been cast by opponents as a failure, has not gone down well in currency markets, with the pound falling to a day’s lows.
The euro fell as the euro zone economy showed more signs it’s beginning to sputter, while the dollar made some headway as investors turned nervous about a slowdown in China.
The euro was hurt when the European Central Bank cut forecasts for economic growth and inflation. The reduction was modest, but its underscored concerns about a euro zone slowdown and the central bank’s caution as it ends its bond-buying scheme and tries to wean the region off stimulus.
Analysts say the next catalyst for larger moves in the dollar will be the Federal Reserve’s Dec. 18-19 meeting. It is expected to raise interest rates and give guidance on the pace of any tightening next year.