Sterling falls below $1.20 again on fears over Theresa May's Brexit speech

Emma Haslett
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Theresa May Meets Angela Merkel In Berlin
May is expected to outline her plans for a so-called hard Brexit (Source: Getty)

The pound tumbled below $1.20 this morning for the first time since October's so-called flash crash, as investors nervously awaited a speech from Theresa May.

Late last night the pound hit a three-month low, falling to $1.1983 as trading resumed in Australia and New Zealand.

Having recovered slightly overnight, this morning it fell as low as $1.996, 1.5 per cent down. At the time of writing, it was hovering at $1.2033, 1.2 per cent down.

The Prime Minister will address an audience of diplomats including EU officials tomorrow, in what has been dubbed the most significant speech of her premiership.

May is expected to formalise her intentions to pursue a so-called hard Brexit, saying the UK is prepared to leave the Single Market, customs union and the jurisdiction of the European Court of Justice.

"The pound hasn’t wasted any time in reacting to the early reports," said Connor Campbell, financial analyst at Spreadex.

"While there is every chance it could see some kind of recovery tomorrow if a firm strategy is finally laid out, the size of this morning’s decline suggests that may not matter as much anymore."

Still - there was a bright side.

"This latest pound-drama is set to define Monday’s trading, something that could be good news for the FTSE," added Campbell.

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