Forex

Sterling slumps to 5-week low on Brexit uncertainty

2019-10-09 12:39:18 GMT (Economies.com)

The British pound fell against US dollar today for the third straight session, near touching its 5-week low, on rising concerns about the Brexit, after several news agencies reported that the ongoing talks between British PM Johnson and Brussels are within sight of of collapsing without pulling off an exit deal.

 

GBP/USD fell by 0.2% to $1.2197, from the opening of $1.2216, with an intraday high of $1.2226.

 

Sterling shed 0.6% yesterday, its second daily loss and slumped to 5-week low of $1.2195, on concerns about a chaotic exit from the EU.

 

According to Downing Street source on Tuesday, German Chancellor Angela Merkel told PM Boris Johnson that his proposals on the Brexit deal are “overwhelmingly unlikely”.

 

The Eurogroup will meet on Wednesday in Brussels to discuss the European economic policies, and the group may take a decision on the Brexit crisis.

 

While as the Brexit deadline approaches (in October 31st), concerns mounted over the possibility of the British government and Brussels reaching a Brexit deal to avoid a chaotic exit, which is expected to have serious impacts on the UK's economy.

 

The Times newspaper also reported that Johnson is facing cabinet revolt in the government as a group of ministers are preparing to resign due to fears that he is leading the country towards a no-deal Brexit.

 

British PM Boris Johnson insists on implementing the Brexit as scheduled whether with a deal or not "delivering on the will of the people" while the parliament is rejecting that no-deal Brexit scenario.

 

The British Parliament has passed a legislation last month demanding that Johnson request a postponement for the Brexit until the end of January in case of a no deal, while as it appears Johnson doesn't consent with that legislation so far.

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