This morning, the value of the pound has dropped to a weekly low against the euro as Theresa May, the British Prime Minister, was grilled by a Commons committee over her Brexit deal.
Theresa May defended her withdrawal agreement in front of the liaison committee of the House of Commons a day after Bank of England released a bleak no-deal forecast. The BoE said that house prices, the GDP, and the pound itself would experience sharp declines.
May said that if she would lose next month’s parliamentary vote on the deal, it would kickstart the preparations for a no-deal Brexit.
She stated: “The timetable is such that actually, some people would need to take some practical steps in relation to no deal if the parliament were to vote down the deal on the 11th of December.”
The value of the pound has dropped by 0.5 percent against the dollar to $1.2759. It also dropped by 0.3 percent against the euro to €1.112.
David Cheetham, an analyst at XTB, stated: “Negative assessments on future growth prospects post-Brexit from chancellor Philip Hammond and the Bank of England have unsurprisingly drawn widespread criticism from Brexiteers.”
He added: “But while they may have a case in claiming the forecasts are overly gloomy, at the moment there’s nothing but wishful thinking to suggest the economy won’t slow significantly.”
MPs are scheduled to vote on the Brexit deal of PM May on the 11th of December and the increasing uncertainty over whether it will be approved, coupled with the no-deal forecasts of the BoE has led the pound to slip at the close of a rocky month for the currency.
Earlier this month, the pound was able to reach highs of $1.312 before a series of resignations that was led by Jo Johnson and followed by Dominic Raab. Also, the uncertainty over the tabled withdrawal agreement sent the currency plunging to $1.27.