Pound rises as Barnier hints at Brexit deal

Market report Hannah Burley

Sterling jumped to a six-week high after Michel Barnier indicated a Brexit deal is within sight.

The pound was up nearly 1 per cent versus the dollar at $1.302 and gained 0.4 per cent against the euro to end the session on €1.122.

The boost came after the EU’S chief negotiator said a Brexit deal could be achieved within the next six to eight weeks.

“The currency is desperate for any signs of good news from the EU’S chief negotiator, often making the most of some pretty tepid statements.

“Monday’s gains seem slightly more justified however, with Barnier saying that it was a ‘realistic’ possibility a deal could be reached by November,” said Connor Campbell, financial analyst at Spreadex.

The pound, which has suffered recently as fears mount that Britain is set to crash out of the EU without a deal, was also spurred on by Office for National Statistics figures which showed the economy expanded 0.3 per cent in July.

The pound’s gains knocked the FTSE 100, which closed up 0.02 per cent, at 7,279.3.

Primark owner Associated British Foods closed down 13p at 2,257p after warning it will take a £20 million hit due to the stronger pound.

Meanwhile, Dignity shares slid 55p to 977p after rival Co-op Funeralcare said it is reducing its “simple funeral” cost by £100 to £1,895, and by a further £200 for its 4.7 million members.

The biggest risers on the FTSE 100 included

Royal Bank of Scotland, up 4.3p at 249.3p, and

Morrisons, up 4.25p at 266.15p, while the biggest fallers included Fresnillo, down 21.6p at 812.4p, and Glencore, down 5.2p at 290.75p.