Pound falls to 30-month low amid continued no-deal Brexit fears

Boris Johnson, pictured in London on Wednesday, has pledged to leave the EU on October 31 with or without a deal

Simon Dawson/EPA

James Morris1 August 2019

The pound today fell to a 30-month low amid continued fears of a no-deal Brexit.

Sterling plunged to a low of $1.21 overnight in Asia, its lowest since January 2017.

It comes after the pound lost more than four per cent of its value in July: its worst month since October 2016.

New Prime Minister Boris Johnson has vowed to leave the EU on October 31 with or without a deal with Brussels – sparking panic among investors.

And Chancellor Sajid Javid has announced an extra £2.1 billion of funding to prepare for no-deal, sparking a major backlash from Remain-backing MPs.

Roger Hallam, currency chief investment officer at JP Morgan Asset Management, warned the pound could suffer further plunges in the next few weeks.

Countdown to Brexit: 91 days until Britain leaves the EU

He said: "Sterling remains vulnerable to a further escalation in Brexit tensions and we anticipate the market will likely discount higher risks of a no-deal outcome in the weeks ahead."

Meanwhile, the Bank of England was preparing to make an interest rate announcement on Thursday.

It is expected to keep rates on hold, but strike a more dovish tone as it seeks to ease concerns about the potential economic hit by a disruptive break from the EU.

Additional reporting by Reuters.