British pound sterling declined near 2018 lows on rising U.S. dollar

British Pound

The British pound sterling fell on Wednesday, due to the sudden rise of the U.S. dollar. The British pound settled at $1.3480 against the greenback, which was 0.2% lower from their previous settlement and hovers near its 2018 low of $1.3452 capped on Tuesday. Against the euro, the pound managed to rose by 0.3% and was seen settling at 87.390 pence per euro.

The firm and smooth rally of the U.S. dollar along with diminishing expectations of interest rate hike from the BoE affected the stance of the British pound.

According to Fiona Cincotta, a market analyst at City Index: The British pound has been having a hard time pulling itself to recovery due to weak data, a neutral Bank of England as well as the raising concerns over the stance of the labor market. This was also followed by new concerns regarding Britain’s Brexit negotiations.

In accordance to this, a report on Tuesday indicated that the British government announced that it would publish detailed plans for its future relationships with the EU in June, in order to break the stalemate in Brexit negotiations. Analysts are claiming that the uncertainty over the ongoing Brexit talks also means uncertainty over the stance of the pound.

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