The British pound fell to its lowest in more than two years in early trading in Europe Wednesday as fears over a "Hard Brexit" and a possible general election exacted a higher risk premium for all sterling assets.
The Times of London reported that Boris Johnson, the favorite to win the current Conservative Party leadership contest and take over as Prime Minister, is looking to call a general election as early as next year. Opinion polls suggest an election would not give any party a clear majority. Johnson has already pledged to take Britain out of the EU in October even if that means scrapping a transitional deal that would have cushioned the blow to the U.K.'s economy.
The pound fell nearly 1% on Tuesday against the dollar and continued its decline on Wednesday. By 3:45 AM ET (07:45 GMT), it was at $1.2393, having fallen below $1.24 for the first time since April 2017. Sterling was also lower against the euro, tumbling as far at 1.1047, its lowest since September 2017, before bouncing to 1.1058.
Source : Investing.com