Pound has fallen to a six-week low today and was trading at $1.29– the lowest level since September 10.
With just over five months to go until Britain’s scheduled departure from the EU, there is still no clarity over the sticky Northern Ireland border issue.
Fiona Cincotta from City Index commented: “There is unlikely to be any serious or sustained respite for the pound until Brexit actually happens as the currency is being buffeted daily by threats of a no-deal divorce and rumours of a challenge to Theresa May’s leadership.
“The focus next week will be on Chancellor Phillip Hammond’s budget but any effect of his financial plans which could include fewer tax increases than initially expected could be drowned out by the persistent Brexit drama being played out in the background. The pound has slipped 0.22% against the dollar having gained half a percent yesterday but is holding flat against the euro. The euro is continuing to face its own pressures as the European Commission rejected Italy’s budget which is breaching EU deficit targets. The unprecedented move is now taking the EU into unchartered waters as Italy shows no signs of intending to back down.”
May is due to address a private parliamentary meeting of restive Conservative Party lawmakers later today.