The GBP / INR is down for the fourth day in a row on Tuesday, as the pound comes under pressure amid Brexit negotiations uncertainty. At the time of writing, one pound sterling buys 98.367 Indian rupees, down 0.40% at 8:00 UTC.
After a week bullish for the British pound, which was supported by vaccine optimism, the British currency is losing ground as the UK and European Union still have not addressed the three most contentious issues hindering a post-Brexit trade deal. Leaders on both sides will meet face to face to make a final attempt to seal the deal after failing to reach consensus on Monday. The chances of a no-deal Brexit are higher and economists fear it could have a devastating effect on the UK economy, especially given the damage caused by the pandemic.
At the end of December, Britain is expected to withdraw from the bloc completely. An important UK government source told media that there was “every chance we’re not gonna make it. On the other hand, EU officials said the negotiations had regressed.
British Prime Minister Boris Johnson is traveling to Brussels to meet in person with the President of the European Commission, Ursula von der Leyen.
Irish Foreign Minister Simon Coveney said negotiators are expected to agree until Wednesday, before an EU summit scheduled for Thursday and Friday.
Johnson and von der Leyen said in a joint statement after discussing by telephone that “the conditions for an agreement are not met due to persistent differences on critical issues. We have asked our chief negotiators to prepare an overview of the remaining disputes which will be discussed in person in the coming days.
Investor prices in a possible no-deal Brexit
The decline in the pound shows that investors are less confident in a trade deal. Over the past few weeks, the rhetoric has been that a deal is possible despite the differences, but the gaps do not appear to be narrowing.
French European Affairs Minister Clément Beaune said earlier today that France will not agree to any deal that “sacrifices” its fishermen.
Elsewhere, UK Health Minister Matt Hancock said Johnson was doing everything to reach a Brexit deal. He told Sky News:
“I know the Prime Minister is doing everything he can to try to get a deal that works for both the UK and the EU, this deal is potentially doable, but the EU clearly has to want to do it.“