FOREX-Dollar firm, sterling on the defensive over Brexit impact fears

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TOKYO The dollar firmed in early Asian trading on Tuesday, while recently beleaguered sterling wallowed close to recent lows on continuing fears about the likely impact on Britain from exiting the European Union.

Japanese, Canadian and some U.S. markets were closed on Monday for holidays.

The pound was down 0.1 percent against the dollar at $1.2347 GBP=, below its overnight low of $1.2345, in the wake of Friday’s “flash crash” that sent it hurtling to its lowest levels in 31 years.

“Economic data does not help very much to explain sterling’s movement. The fact of the matter is that the UK has fared well in the three and half months since the referendum,” wrote Marc Chandler, global head of currency strategy at Brown Brothers Harriman.

“The depreciation of sterling will have an impact on the UK current account balance,” he said. “It will be reduced, but do not be surprised if…

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