The pound is tanking as May speech deepens Brexit crisis

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• The pound dives as Theresa May delivers speech that pushes the UK closer to a hard Brexit.
• Pound dollar exchange rate drops more than 1.4% as speech progresses.
• "I will note overturn the result of the referendum, nor will I break up my country," May said in a speech at Number 10 Downing Street.

LONDON - The pound has dropped sharply on Friday afternoon after British Prime Minister Theresa May used a speech to say that the UK and EU have reached an impasse in Brexit negotiations, and accuse the European Union of a lack of respect during recent talks.

"I will note overturn the result of the referendum, nor will I break up my country," May said in a speech at Number 10 Downing Street.

As May's speech ended at around 2.10 p.m. BST (9.10 a.m. ET), the pound was down 1.4% against the dollar and around 1% against the euro, as markets interpreted May's words as making a hard Brexit more likely.

Here's the chart of the pound's movement against the dollar:

Markets Insider

During her speech, May warned that Britain may be heading towards a no deal Brexit, saying: "We must and will prepare ourselves for no deal."

"Anything which fails to respect the referendum or which effectively divides our country in two would be a bad deal and I have always said no deal is better than a bad deal," she said.

May's speech followed the end of summit talks on Thursday which had initially been billed as a chance for European diplomats and leaders to offer Theresa May words of support and shore up backing for a Brexit deal at home.

That scenario did not materialise however, with the summit turning into a tit-for-tat war of words between the two sides of negotiations. Donald Tusk, the European Council president, said after the summit that May's proposals "will not work."

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