The pound is pulling back from its morning lows

LONDON — Sterling is pulling back a little on Wednesday after earlier sliding toward new lows earlier following disappointing trade data released by the Office for National Statistics (ONS).

The pound is down roughly 0.25% against the dollar as of 11.15 a.m. GMT (6.15 a.m. ET) to $1.2146, having fallen as low as $1.2106 in earlier trade. That took it close to the currency’s post-referendum low (discounting October’s flash crash, when sterling dropped more than 6% in two minutes).

Here’s the chart:

pound jan 11 2Markets Insider

The earlier fall was due to weaker than expected trade data from the ONS, which showed that imports grew by £3.3 billion in November 2016 compared to November 2015 and exports rose at a more modest pace of £700 million. Overall, the UK’s trade deficit — the gap between what the value of what the UK exports and what it imports — stood at £4.2 billion in November, around £600 million more than forecast.

The trade deficit pours cold water on the idea that sterling’s post-referendum crash will help the UK’s economy by boosting exports as foreign nations and investors take advantage of cheaper British goods.

Sterling has had a turbulent week so far, falling more than 1% on Monday after Theresa May signalled in an interview that the UK is likely to quit the Single Market when Brexit occurs.

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