Value of the pound continues to falter
There is a lot of uncertainty surrounding the likelihood of the UK leaving the EU with no transitional deal. For businesses either side of the debate there is shared sentiment that trade will face significant disruption and price hikes.
As a result, the value of the pound has started to feel those effects falling below $1.29 for the first time in almost a year. The Euro too grew stronger, with pound also hitting a nine-month low.
Bank of England governor Mark Carney stated on Friday that the chances of a no-deal Brexit were "uncomfortably high". The following Sunday, Liam Fox echoed the sentiment putting the odds at "certainly not much more than 60-40".
Despite the recent increase in interest rates, the pound has seen a fall of 1.7% against the dollar and 0.8% against the Euro. These results make for interesting reading given that they were taken over a period of days rather than weeks.
The head of foreign exchange strategy at CIBC, Jeremy Stretch, said: "If there's no improvement in the negotiating strategy with the EU, we could see the pound going back to levels not seen since last autumn, around $1.28 - and if it falls through that, it could go lower still.
Until the government can share a better picture of where we stand come March 2019 its clear these fluctuations will continue. The Bank of England may have built a backstop to give the country stability, but with no one placed to give an accurate forecast we will continue to forge these difficult uncharted waters.
