British pound headed to 30-year low, reached in the days after the referendum Brexit, after Prime Minister Theresa May announced it would activate Article 50 of the Lisbon Treaty before the end of March 2017. The currency fell to its lowest level since July 6, when it reached 1.2798 GBP/USD, which is the lowest level in 31 years.
Overall the British pound fell against 31 of its major competitors. The data from hedge funds showed that the speculators increased bids that the currency will continue to become cheaper.
During the annual conference of the Conservative Party, Theresa May told delegates that will shrink immigration, sparking speculation that London is directed to so called “Hard exit” from the European Union, implying limited access to the single market.
The GBP limited some of the losses after the PMI in manufacturing sector rose to its highest level in two years. The shares of exporters rose, supported notably by the weak currency. Although the announcement of the deadline for the activation of Article 50 eliminates some uncertainty for British business. Theresa May did not give many details about exactly how it will look separation between the UK and the European Union.
After the Brexit referendum, the GBP fell by 13% against USD, and last week sent its worst quarterly declines series, namely – five straight. The short positions, or bids on weaker pound against the dollar exceeded long positions by 87,700 contract last week, according to Commodity Futures Trading Commission in Washington.
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