Brexit fears hit sterling

THE pound has touched its lowest level since January, as traders fretted over the perils of a No Deal Brexit and Labour seizing power.

sterling slipped below $1.27 for the first time in almost five months, following growing speculation that Theresa May’s Brexit deal will be junked by her replacement as Tory leader and Prime Minister.

It later regained all of this lost ground and was up very slightly at $1.2749 on the day, at the time of going to press.

The pound has been falling against the Us dollar since May 2, when it stood at almost $1.32.

May is stepping down within weeks, and her most likely successor is seen as Boris Johnson, a leading voice for Leave during the referendum campaign, who has since downplayed the risks of leaving without an agreement with the European Union.

analysts fear a No Deal exit is therefore becoming more likely – and this is seen on trading floors as dangerous for the British economy, meaning investors are transferring their cash to other countries.

a new Tory leader may also be forced to hold a general election which Labour could win, it is feared.

Labour leader Jeremy Corbyn has threatened to launch a wave of renationalisation which would see investors paid less than their assets are worth on the market.

It is thought this and his other policies would be devastating for UK growth and confidence in the country.

sterling climbed 0.1pc yesterday against the euro to €1.14.