- Posted by currencies in Bank of England, Brexit, Currency, Dollar, Economy, EUR, GBP, Sterling, UK, Uncategorised
- August 21, 2018
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Sterling has continued to be under pressure and is still near the 14-month lows reached last week on concerns about forthcoming talks that may decide whether Britain gets a trade deal with the EU before it quits the bloc.
The pound has suffered six straight weeks of losses against the dollar, its worst run since 2014, even though data such as retail sales suggest the UK economy is holding up.
With less than eight months to go until Britain leaves the EU, the government has yet to agree with Brussels the terms of its departure, and some hedge funds have started betting against the currency.
Analysts say sterling, which has shed 12 percent of its value since April, will remain vulnerable to the vagaries of Brexit negotiations in the months ahead.
Secretary Dominic Raab will return to Brussels today to negotiate with counterpart Michel Barnier as the risk of a no-deal departure becomes increasingly likely.
Talks resumed last week after a short summer break with both sides struggling to make a breakthrough on the contentious Irish border issue, no-deal will be the focus of Mr Raab’ week.
Another two days of negotiations have been booked in between Westminster and Brussels.
Mr Raab and Mr Barnier will meet today after a discussion on the future UK-EU relationship. Tomorrow, they will also talk over the remaining issues of the withdrawal agreement.
Theresa May’s Cabinet is set to release 84 no-deal preparation notices, which have been put together by the Department for Exiting the European Union, before the end of the month.
There is no key UK economic data releases this week that could improve the pound, the focus will be as mentioned above – Brexit negotiations.