Brexit worries see pound hit 31-year low against dollar


Sterling has sunk to a fresh 31-year low against the US dollar as concerns over a "hard Brexit" continue to weigh on the UK currency.

The pound was down 0.8% against the greenback at 1.264 US dollars, as investors remained spooked by the Prime Minister's announcement on Tuesday that she will trigger Article 50 by March next year.

This is expected to herald a "hard Brexit", pulling Britain out of the European single market so the Government can tighten its grip on immigration.

The fall came as sterling remained at a five-year low against the euro, down 0.5% at 1.131 euro.

Connor Campbell, financial analyst at Spreadex, said German chancellor Angela Merkel's warning on Brexit was also driving the pound lower.

"It seems that we are firmly back in Brexit-dominating territory - even the mildest squawkings from the news wire are causing pain for the pound.

"Today it was the turn of Angela Merkel to make sterling's life even more difficult, the German leader resolute in her claim that freedom of movement is a must if Britain wants to stand any chance of remaining in the single market."

Laith Khalaf, senior analyst at Hargreaves Lansdown, said sterling could also be taking a hit as the dollar strengthens ahead of Friday's US non-farm employment update.

"Investors are showing more concern over the economy and might also be looking at the US jobs report out tomorrow, which may provide further fuel to the fire in terms of boosting the dollar if its ahead of expectations."