DHAKA: The pound has hit its lowest level for more than three months on reports Britain was set to quit the EU single market as part of its Brexit plans.

Sterling fell below the $1.20 level before recovering slightly on Monday.

The pound also dropped to a two-month low against the euro, falling more than 1 percent to about €1.13 in Asian trading, reports the BBC.

Analysts said traders were reacting to reports that UK Prime Minister Theresa May would use a speech on Tuesday to signal a so-called “hard Brexit”.

Reports have suggested she will signal pulling out of the EU single market and customs union, although Downing Street described this as ‘speculation’.

The pound has fallen about 20 percent against the dollar since June’s EU referendum, to lows last regularly seen in 1985.

Much of that volatility has been due to uncertainty about the economic impact if the UK gives up its tariff-free access to the EU.

BDST: 1705 HRS, JAN 16, 2017
BD