The pound depreciated against its major counterparts in the European session on Friday, as growing hopes of the U.K. leaving the European Union without a trade deal weighed on the currency.
Prime minister Boris Johnson warned of a strong possibility of a no deal outcome, instructing the government to prepare for leaving the European Union’s single market at the end of this year.
The ministers “agreed very strongly with me that the deal on the table is really not at the moment right for the UK,” he told on Thursday.
The UK and the EU have set a Sunday deadline to decide on the future of trade talks following the meeting in Brussels.
The EU published no-deal contingency measures on Thursday, which ensures basic reciprocal air and road connectivity for six months.
The pound slipped to 1.3184 against the greenback, its lowest level since November 17. The pound is seen finding support around the 1.28 level.
The pound fell to a fresh 3-week low of 137.31 against the yen from Thursday’s closing quote of 138.49. The pound is likely to find support around the 135.00 level.
The U.K. currency dropped to the weakest level since September 23 versus the franc, at 1.1699. Should the pound slides further, 1.15 is likely seen as its next downside target level.
The pound dipped to near a 3-month low of 0.9193 against the euro, compared to yesterday’s closing value of 0.9126. Next key support for the pound is seen around the 0.93 mark.
Final data from Destatis showed that German consumer prices declined for the third straight month in November.
Consumer prices fell 0.3 percent year-on-year in November, following declines of 0.2 percent each in both September and October. The rate came in line with the estimate published on November 30.
Looking ahead, U.S. producer price index for November and University of Michigan’s preliminary consumer sentiment index for December are set for release in the New York session.
The material has been provided by InstaForex Company – www.instaforex.com