British pound claws back from 30-year Brexit low

[NEW YORK] The British pound clawed back some losses on Tuesday from a battering following Britain's decision to leave the European Union as investors took a breather from the wild markets ride.

The foreign currency market calmed somewhat, equity markets rebounded and oil prices rose after a bloodletting triggered by Britain's shock vote Thursday to exit the EU.

The pound, which had plunged to a 30-year low against the dollar on Monday at US$1.3121, rose 0.8 per cent to US$1.3340 around 2100 GMT.

The pound also made headway against the euro, trading at 82.94 pence per euro compared with 83.32 pence on Monday.

"Sterling's substantial slide may have abated for now but underlying sentiment remains decidedly bearish which will leave it vulnerable to persistent selling pressure over the foreseeable future," said Joe Manimbo of Western Union Business Solutions.

Kathy Lien, analyst at BK Asset Management, agreed.

She called the rise in the pound a "dead cat bounce" as Britain faces fundamental questions over who is going to lead the country and how they are going to negotiate an exit from the EU.

"There's a lot of uncertainty left in Europe," she said.

The dollar retreated against the euro after strong gains in the prior two sessions. The European currency rose to US$1.1065 from US$1.1022.

The yen fell on abating demand for safe haven and speculation that Japan will introduce new measures to offset the pressure on the currency from Brexit.

AFP