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Pound is weakening on Friday

The pound weakened on Friday after stellar gains this week set the currency for the biggest weekly gain against the euro since September 2017 on growing confidence that a no-deal Brexit can be avoided.

For the time being, the focus has been on retail sales data in January at 09:30 GMT for the latest clues on the UK economic prospects, which has taken a back seat in past weeks for traders.

In a tumultuous week on British politics, Prime Minister Theresa May’s Brexit deal suffered a heavy defeat in parliament on Tuesday, but she won a subsequent vote of confidence, removing political uncertainty for the time being.

Having reached two-month highs on Thursday, sterling drifted lower in early Friday trade.

At 0830 GMT, pound was down a third of a percent at $1.2951, having touched $1.30 on Thursday.

Against the euro, sterling was down over a third of a percent at 87.99 pence and below two-month peaks hit a day earlier at around 87.65 pence.

“With each tick-up in sterling, it shows that markets are less and less concerned about a no-deal Brexit and less concerned about election risk,” said Sarah Hewin, chief economist for Europe and Americas at Standard Chartered.

 

Source: Reuters