You are using an older browser version. Please use a supported version for the best MSN experience.

Money Top Stories

Pound Falls as EU Warns Brexit Transition Period Not a Given

Bloomberg logoBloomberg 09/02/2018 Charlotte Ryan

© Bloomberg * Sterling heads for its biggest weekly decline since October

* Pendulum is shifting from a soft to hard Brexit, says Mizuho

The pound fell and gilts rallied as the European Union’s chief negotiator Michel Barnier said that a Brexit transition period wasn’t a given if disagreements with the U.K. persisted.

Sterling headed for a weekly loss as Barnier struck a downbeat tone following the latest round of Brexit talks, saying that disagreements remained on the role of the European Court of Justice in the deal and that citizens’ rights was a “major issue” for the EU side.

Pound Swings © Provided by Bloomberg LP Pound Swings

“The pound is pushing lower as the pendulum shifts from a soft to a hard Brexit,” said Neil Jones, head of hedge fund sales at Mizuho Bank Ltd. “Some suggest a soft Brexit is indeed dead, leaving a hard or a very hard option. The pound should continue to trade lower on the crosses.”

The pound fell 0.6 percent to $1.3830 as of 11:57 a.m. in London. It has declined 2.2 percent this week, headed for its biggest weekly loss since October.

Bonds rallied across the board, with the yield on U.K. 10-year government bonds slipping four basis points to 1.58 percent.

NOW SEE:

* Irish border checks now 'unavoidable'

* Britain to world: Please pretend we're not leaving EU

AdChoices
AdChoices
image beaconimage beaconimage beacon