Pound loses on new Brexit deadline report

Following reports that UK Prime Minister Boris Johnson was seeking a hard line on Britain’s transition period after Brexit, the British Pound shed some weight.

 

It dropped as much as 0.7% to $1.3236 GBP=D4.

 

ITV, a UK broadcaster reported on Monday that the Prime minister’s revised Withdrawal Agreement Bill would require the United Kingdom to have arrangements to leave the European Union be in place by December 31 next year.

 

This agreement dashes hopes Johnson would take a flexible approach to the end-2020 deadline for a trade deal with the EU after Britain leaves the bloc, which now looks almost certain to happen on January 31 following the landslide Conservative election win, reports Reuters.

 

Masafumi Yamamoto, chief currency strategist at Mizuho Securities said,” It seems like the big majority Johnson won is enabling him to take a hard line approach, which the market doesn’t like so much… Considering the UK economy looks set to deteriorate as people and companies start to leave the country because of Brexit, sterling’s short-covering rally is over”.

 

The dollar against the yen traded at 109.56 yen JPY=, up 0.05% from late U.S. levels, having gained 0.15% on Monday to edge near six-month high of 109.73 hit on December 2.

 

The euro stood at $1.1147 EUR=, maintaining its uptrend from its seven-week low of $1.1098 reached on November 29.