Pound Falls After Belfast High Court Rejects Legal Challenge To Brexit

The pound declined against its key counterparts in European trading on Friday, as Belfast High Court dismissed legal proceedings challenging the U.K. vote to leave the European Union and said Government could trigger Article 50 as planned.

Rejecting the claims by lawyers of the Stormont politicians and Raymond McCord, Justice Maguire ruled that the consent from Stormont is not needed to begin Brexit negotiations with Europe.

Justice Maguire concluded that the actual effect of the process of change and its impact is still uncertain.

"While the wind of change may be about to blow, the precise direction in which it will blow cannot yet be determined so there is a level of uncertainty, as evidenced by the discussion about how the Northern Ireland land border with Ireland was affected by withdrawal from the EU," he added.

Further undermining the currency was rising aversion, ahead of the U.S. GDP tonight that could strengthen the case for the Federal Reserve to raise rates by the year-end.

The pound showed mixed trading in the Asian session. While the currency rose against the yen, it held steady against the franc, greenback and the euro.

The pound fell to a 3-day low of 1.2114 against the U.S. dollar, from an early high of 1.2189. If the pound extends its downtrend, it is likely to find support around the 1.19 region.

The pound dropped to 8-day lows of 0.9009 against the euro and 1.2047 versus the Swiss franc from early highs of 0.8945 and 1.2110, respectively. The next possible support for the pound may be found around 0.92 against the euro and 1.18 against the franc.

Reversing from an early high of 128.28 against the yen, the pound edged down to 127.60. Continuation of the pound's downtrend may see it challenging support around the 125.00 zone.

Looking ahead, German preliminary consumer price index for October, U.S. advanced GDP data for the third quarter, University of Michigan's final consumer sentiment index for October and U.S. rig count data are due to be released in the New York session.