GBP fell over talks of negative interest rate and Brexit
GBP retreated to US$1.22 yesterday as investors expressed concern about possible negative interest rates in the UK and to comments of government officials that there was little progress in the negotiations on Brexit.
Lead economist of Bank of England Andy Haldane on May 26 underestimated the prospect of the inevitable change in interest rates, saying that "analysing and doing are different things".
But experts think that after talks about negative rates will take over the market, it will be hard to shift the focus from them.
In addition, the British spokesman for the negotiations with the EU David Frost on May 27 confirmed that the UK will not prolong the transition period of Brexit, which expires in December, further weakening the GBP. He also stated that by July will be difficult to agree on fishing regulations with the block.
With trade agreement negotiations after Brexit not moving forward at all, Britain risks leaving the EU without a trade deal in late 2020.
Last time British pound lost 0.92% to $1.2219, losing all gains on Tuesday. It fell by 0.9% against the euro to 89.92 pence, a six-day low as the strong 90-pence barrier held.