Market report: Prospect of hard Brexit piles further pressure on the pound

The Prospectofhard pound notched up a record 10 consecutive weeks of losses against the euro yesterday amid political uncertainty and rising expectations of a no-deal Brexit.

In a note to clients, analysts at MUFG said: “We expect the pound to continue weakening heading into the crunch autumn Brexit period. The pound sell-off remains relentless with no clear end in sight.”

Investors and economists seem to also have taken little notice of statements from the Bank of England that it could raise rates in the coming months.

The pound traded 0.30pc higher against the dollar at $1.2564 and added 0.25pc versus the euro at €1.1157.

Elsewhere, Hiscox shares were in the red after it warned that last year’s natural disaster claims would be more expensive than anticipated and hit profits.

The Lloyd’s of London insurer, which underwrites risks from terrorism to kidnappings, said it had seen “continued deterioration” from catastrophe events in 2018, including Typhoon Jebi in Japan and Hurricane Michael in Florida. This prompted the firm to increase its reserves for the disasters by about $40m (£32m).

Pre-tax profit for the first half of the year is expected to be between $150m and $170m, with $150m of that coming from investment returns.