The British Pound has fallen consecutively as the U.S. dollar strengthens, leaving the pound at its weakest since June 2017 and facing its longest losing streak since the depths of the financial crisis in 2008.
Pound has weakened since August and traders grow increasingly worried that Britain will crash out of the European Union next year without a trade deal at this rate.
Sometime last month, the pound slipped further to as low as $1.2689, its weakest since June 22, 2017, as the dollar extended its rally.
The pound also fell versus the euro after earlier gains, and was down 0.1 percent at 89.340 pence per euro in late European trading.
‘’It’s not just a question of Brexit, it’s also a recognition that the UK economy has not been particularly strong. So, we need to recognize will be a great deal of volatility in pounds in both directions with the news and rumors around Brexit you can see a weakening trend for pounds” Aviva Investor’s Head of Multi-Asset Funds Sunil Krishnan told Reuters.
Consumer price inflation nudged up to 2.5 percent year-on-year in July from 2.4 percent the previous month, in line with a Reuters poll of analysts.
According to a Forex Time analysts, what is likely to be more concerning domestically is that inflation is once again outpacing wage growth, which will lead to the question over whether the Bank of England might be tempted to lean towards another increase in UK interest rates.
The Bank of England raised rates in early August but made it clear that future hikes would be limited, gradual and dependent on Britain securing a smooth departure from the EU.