Sterling Slides as Brexit Worries Resume

The Pound Sterling lost its positive momentum and fell to a 20 year trough against the US Dollar on growing fears that the UK will withdraw from the EU without an agreement. While Brexit worries dominate markets’ attention generally, today’s Bank of England decision will be closely watched. Analysts recently polled are in agreement that the BoE will maintain rates at exiting levels, but it is how Mark Carney, the BoE Governor, will address the growing risk of a hard crash out of the EU which is of paramount importance.

As reported at 11:00 am (GMT) in London, the GBP/USD was trading lower at $1.2095, down 0.4469%; the pair has ranged from $1.2087 to $1.2162 in today’s trading day. The EUR/GBP is trading higher at 0.9125 Pence, up 0.1592%, and not too far off the earlier session peak of 0.9134 Pence.

Mixed bag of EU Manufacturing Data

In the Eurozone, Markit’s release of manufacturing data was generally mixed. Spain and Italy saw an improvement in the July readings to 48.2 and 48.5, respectively, slightly better than analysts had been predicting. Germany and France, the first and second largest economies, fared worse, with readings that missed expectations at 43.2 and 49.7, respectively, against the forecasts of 45.4 and 50. The EUR/USD pair was trading lower at $1.1035, down 0.3441% and off the session low of $1.1032.

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