Sterling fell by almost half a cent against the dollar in a minute on Monday, with traders citing a Bloomberg headline that Brexit negotiations could be heading for a breakdown.
The pound fell to the day’s lows of $1.3246 , having been trading around $1.3291 beforehand, leaving it down 0.2 percent on the day.
“(The move) is squarely on that phrase, ‘Brexit breakdown’,” said Mizuho’s head of hedge fund currency sales, Neil Jones. “The correlation is still there – any suggestion of a harder Brexit is generating significant sterling selling.”
As we have mentioned today, the only reason which can push GBPUSD lower would be the Brexit Talks.