A squirt of Brexit commentary from anonymous EU sources has splattered sterling lower this morning, despite the momentous news that Pfizer's vaccine has been approved for use in the UK from next week.

   

Despite the myriad of economic uncertainties facing the UK economy, Brexit retains an unmatched ability to induce knee-jerk reactions in the pound, and this morning's ominous story about Michel Barnier telling EU ambassadors that three obstacles remain to a trade deal with the UK is no exception. There is not much further to be said about the chance of a no-deal Brexit. We know that no-deal is still at least a plausible outcome, but is far less likely than the base case of a bare-bones trade deal covering most or all goods. Given sterling's buoyancy of late, it seems that if no-deal does materialise the pound will suffer further knee-jerk losses of the sort seen this morning, but at a greater magnitude.