No-deal Brexit chills send pound to a five-month low vs euro

Video credit: Reuters - Business (Amazon FireT
Published on June 18, 2019 - Duration: 01:46s

No-deal Brexit chills send pound to a five-month low vs euro

Signs that arch-Brexiteer Boris Johnson may be a step closer to becoming Britain's next prime minister sent the pound tumbling to a five-month low versus the euro on Tuesday as investors worried about the risks of a hard exit from the European Union.

Pascale Davies reports.


No-deal Brexit chills send pound to a five-month low vs euro

The pound plunged to its lowest level against the euro in five months on Tuesday as the race to be the UK's next prime minister went to a second round of voting among Conservative lawmakers.

The increasing likelihood of arch Brexiteer Boris Johnson becoming the next leader and a hard crash out of the EU has made investors shiver.

Ahead of the vote, he reiterated on Twitter "We must leave the EU on October 31st, with or without a deal'.

Since early May, the currency has weakened more than 6% versus the euro.

Though amid the uncertainty over Brexit, the UK's financial services minister said on Tuesday the British government is doing all it can to keep that sector globally competitive.

While on Monday finance minister Philip Hammond unveiled the London-Shanghai Stock Connect.

(SOUNDBITE) (English) BRITISH FINANCE MINISTER, PHILIP HAMMOND, SAYING: "This unique and historic initiative means that the first shares in a Chinese company are now available to buy on the London Stock Exchange, and it means that UK companies can now list on the Shanghai Exchange -- the first-time ever that foreign companies have been able to list in mainland China." But tensions are mounting within the UK's treasury.

Hammond is reported as being "prepared to resign" over Theresa May's legacy spending plans.

Her intention is to spend up to nine billion pounds per year - 11 billion dollars - on education over the course of three years The government has asked Hammond to free up money from the no-deal Brexit 'war chest' - funds that have been set aside if the UK crashes out of the bloc.

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