The British pound fell to its lowest level against the dollar since April 2017 on Wednesday, as concerns about a no-deal Brexit grew.
By the numbers: Analysts at Morgan Stanley even warned that a no-deal Brexit could send the pound to parity with the dollar for the first time ever. Sterling briefly touched $1.05 in 1985, Bloomberg reported.
Go deeper: Everything you need to know about Brexit
Currency traders are aggressively pricing in a no-deal Brexit scenario after remarks over the weekend from the U.K.'s new government, headed by Prime Minister Boris Johnson, and are selling the pound as a result.
What's happening: Michael Gove, who is in charge of planning for a possible no-deal exit from the EU, has said the British government is "working on the assumption" that it will leave without a deal.
Illustration: Sarah Grillo/Axios
On June 23, 2016, the United Kingdom shocked the world and voted to “Brexit,” or leave the European Union. After more than three years of uncertainty and fractured politics, the U.K. officially exited the EU on Jan. 31, 2020.
U.K. Prime Minister Boris Johnson. Photo: Dominic Lipinski/Pool/AFP/Getty Images
The U.K.'s economy shrank by 0.2% in 2019's second quarter, its first contraction since 2012, the country's Office of National Statistics reported on Friday.
What's happening: Fears of a no-deal Brexit, which could damage the U.K. economy as it drops out of the European Union onto World Trade Organization rules, on October 31 are dampening the country's growth.