No Brexit deal means ‘10% drop in sterling’

Sterling could relapse by almost 10% against the dollar if a “no deal” Brexit becomes likely, keeping investors wary of buying UK assets, Northern Trust Asset Management said.

No Brexit deal means ‘10% drop in sterling’

Sterling could relapse by almost 10% against the dollar if a “no deal” Brexit becomes likely, keeping investors wary of buying UK assets, Northern Trust Asset Management said.

Northern Trust’s EMEA and Asia-Pacific chief investment officer, who helps manage around €857m in assets, told the Reuters Global Investment Outlook Summit the UK crashing out of the EU without a trade deal in place could mean sterling would be hit again.

Against the euro, sterling fell 0.65% to almost 90 pence at one stage as investors worried about the stability of UK prime minister Theresa May’s government.

She needs to speed up negotiations with the EU, business leaders from across Europe, including Ibec’s Danny McCoy, told her at Downing Street amid concern Britain will crash out the world’s biggest trading bloc without a deal. “Business is extremely concerned with the slow pace of negotiations and the lack of progress,” said Emma Marcegaglia, president of BusinessEurope, a lobby group for companies in European countries, including Britain.

“The message to the UK government was clear, business is increasingly frustrated and concerned at the lack of progress in negotiations.

“To move past the first phase of talks, which covers Ireland, the financial settlement, and citizens’ rights, we need practical solutions and firm commitments, not just rhetoric,” Mr McCoy said.

British shoppers reined in their spending by the most in more than four years in October, according to a survey by Visa which added to other signs that the squeeze on UK incomes is hitting consumer spending.

Reuters and Irish Examiner

More in this section

Budget 2022 Logo

What impact will this  year's budget have on you and your business.

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day. PS ... We would love to hear your feedback on the section right HERE.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up