The likelihood of a hard Brexit, where the UK economy crashes out of the European Union without securing a trade deal, is rising once again.
Funds and speculators trading U.S. futures markets are once again turning their guns on sterling, extending their net short position for the second week in a row, something they haven’t done for over two months.
Sterling is not alone in its struggle against the US dollar, which is on the march against all major currencies. But it has the added drag of Brexit, which is infecting the domestic UK growth outlook.
Asian shares stumbled this morning after a rout in tech stocks inflicted a hefty sell-off on Wall Street, while the US dollar hit a 16-month peak on safe haven bets amid political risks in Europe, and bitter Sino-U.S. trade relations.
Asian markets have also been hammered as risk assets have been hurt by rising U.S. interest rates.
Tomorrow we have announcements for European Union’s GDP, followed by US Consumer Price Index.