British Pound Tumbles Over No-Deal Brexit Fears

Reuters reports:

The British pound tumbled on Tuesday as investors bet Prime Minister Boris Johnson’s Brexit brinkmanship with the European Union could trigger a messy divorce that would sow chaos through the world economy and financial markets.

Sterling crashed through trading barriers, falling to a low of $1.2120 in overnight trade, the lowest since March 2017. The pound has lost 3.6 cents since Johnson was named Britain’s new prime minister a week ago.

Ever since the 2016 EU referendum, the pound has gyrated to the rhetoric of the Brexit divorce: after the result was announced, it had the biggest one-day fall since the era of free-floating exchange rates was introduced in the early 1970s. Since the 2016 vote, sterling has now lost 28 cents, one of the most significant falls for the currency in recent decades.

The Independent reports

The pound has sunk well below €1 at Britain’s biggest airports – while the dollar is at parity. At the ICE desk at Heathrow airport on Tuesday morning, The Independent was quoted £117 for buying €100 – making each pound worth just 85 euro cents.

At Gatwick airport on Monday night, the rate was £1 = €0.90. With commission added to a €100 transaction, the cost in sterling was £116. The interbank rate at 7am sank below £1 = €1.09, as the downward pressure on the pound continued.