“Due to a lack of momentum from other sources sterling remains at the mercy of the slow-moving Brexit negotiations,” said Antje Praefcke, a senior currency strategist in Frankfurt at Commerzbank AG.”Whichever way one looks at it, I really see no reason to buy sterling”, she added.
With Brexit negotiations further prolonged, it’s looking increasingly unlikely that the EU will be ready to discuss trade with the U.K., with both sides conflicted over the large amount demanded in the Divorce Bill. The EU has so far demanded a £60 billion figure from the UK for leaving the EU.
Trade talks could be pushed to March, just 12 months before Brexit takes effect in 2019.
Add the lingering uncertainties about Prime Minister Theresa May’s political future into the mix and it’s hard to see any viable signs of a recovery in the pound.