Markets

Sterling heads for longest losing streak since 2000

Sterling fell for ninth day against euro as Theresa May agrees to set a timetable for her exit

Sterling fell 0.1 per cent versus the euro to 87.34 pence per euro, heading for the longest run of declines since December 2000

Thu May 16 2019 - 20:29

Sterling on Thursday headed for the longest losing streak against the euro since the turn of the century as rising UK political risks fanned concern about the nation's ability to achieve an orderly Brexit.

Sterling fell for the ninth day against the euro, as UK prime minister Theresa May bowed to pressure and agreed that next month she will set out a timetable for her exit.

The UK currency also dropped for a fifth day to a three-month low versus the dollar, as global investor sentiment weakened amid the escalating US-China trade conflict.

Sterling has led the past week's losses among major currencies, with investors braced for more turmoil as a May exit risks ushering in a hardline Brexiteer who could take Britain out of the European Union without a deal.

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Investor sentiment was weighed further as former UK foreign secretary Boris Johnson confirmed he would run.

“The timeline of Theresa May’s departure is much closer now,” said Jordan Rochester, a currency strategist at Nomura International.

“There may be positives from the new leader, whoever that may be, but they will face the same stalemate in Parliament and could have to call an election before getting on with anything else.”

Lowest level

Sterling fell 0.1 per cent versus the euro to 87.34 pence per euro, heading for the longest run of declines since December 2000.

Against the dollar, it slipped by 0.3 per cent to $1.2801, after touching the lowest level since February 15th.

Sterling outperformed its peers in the first four months of the year as Britain secured an extension to the Brexit deadline, but has pared the gains since as the UK government has made little progress toward resolving the deadlock.

Mrs May announced this week that she will put her Brexit deal back to a vote in parliament in the week of June 3rd, but it is not expected to be approved given the opposition Labour party is not backing it. – Bloomberg

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