The pound fell versus the dollar and Euro over the last 24 hours after an incoming Bank of England policymaker expressed caution over Britain’s readiness for higher interest rates and uncertainty over the impact of Brexit on the economy.
Sterling fell as much as half a percent as economics professor John Haskel, whose views are relatively unknown and who replaces a policymaker who has called for higher interest rates, spoke to the British parliament’s Treasury Select Committee.
Sterling had enjoyed a bounce off 7-month lows after a Bank of England meeting last week raised expectations of a rate rise in the coming months. But the rally has proved short-lived.
The pound had been one of the best-performing currencies in 2018, but weak economic data and a surge in the dollar have erased all of its gains for this year. It is headed for its weakest quarter since that of the Brexit referendum in 2016.
The summit means the focus for much of the trading sessions this week will be on Britain’s efforts to agree a deal with the EU on the shape of the trading relationship after their divorce.
This morning we have Carney Speaking About Financial Stability of the UK, this will give a hint depending on what he says the timing of the next UK rate hike.