POUND LIVE: Pound dips amid latest Brexit talks and Euro Bank update

Sterling fell against the euro to around 1.13 and against the US dollar to 1.29, as Britain and the EU share progress on four days of Brexit talks between the two sides.

It’s hoped Mr Davis and Mr Barnier will provide clues about how Britain’s future relationship with the EU will pan out, which is set to impact the pound.

Markets are also awaiting an update from the European Central Bank (ECB), which could lead to big movements in the euro.

The central bank is set to keep current policy unchanged, but ECB chief Mario Draghi is expected to give hints about the future course of action.

Billions of euros are pumped into the eurozone each month under a huge money-printing programme set to last until December.

Recent growth in the bloc has fuelled speculation that the ECB may scale back the measures.

However, low inflation could push the bank into extending the Quantitative Easing into next year.

Michael Hewson, chief market analyst at CMC Markets UK, said: “Today’s ECB rate meeting has been touted as an important milestone in the context of how the central bank and ECB President Draghi in particular will manage the communication process of the enormous task of preparing the ground for the slow process of withdrawing from its large scale stimulus package.
 
“We’ve already seen German bund yields shoot up sharply in the last three weeks from 0.24 per cent in expectation of a slightly less dovish outlook as the European economy improves, as markets bet that it is only a matter of when the ECB starts preparing the ground for a slow retreat from its stimulus program.”

More to follow…