Brexit: Pound falls against euro and dollar as May warns of 'moment of crisis' over EU deal

Sterling slides as prime minister says 'no one knows' what will happen if her deal is voted down

The pound fell sharply against the euro on Friday after Theresa May warned the UK faced a “moment of crisis” if MPs reject her Brexit deal again in crucial votes next week.

Sterling fell 0.9 per cent against the single currency to €1.16 and 0.5 per cent against the dollar to $1.30.

Ms May said “no one knows” what will happen if her deal is voted down, telling an audience in Grimsby: “Next week MPs in Westminster face a crucial choice: whether to back the Brexit deal or to reject it. Back it and the UK will leave the European Union.

“Reject it and no one knows what will happen.

“We may not leave the EU for many months, we may leave without the protections that the deal provides. We may never leave at all.”

The pound is expected to register big falls against other major currencies if the UK leaves the EU without a deal later this month.

Meanwhile in the US, stock markets fell after a double dose of bad news for global economic growth.

American jobs growth slowed sharply to just 20,000 in January, well short of the 180,000 expected by analysts.

Despite the figures, US President Donald Trump tweeted on Friday: “This is as good a time as I can remember to be an American Worker. We have the strongest economy in the world.”

The disappointing figure from the world’s largest economy came after China revealed that exports had plummeted by more than 20 per cent in a year while imports fell for a third straight month, pointing to a further slowdown in the country.

Mr Trump said he was confident the US and China could reach an agreement on trade, putting an end to tit-for-tat increases on import taxes between the two global economic superpowers.

Asked if he was still confident he could forge an agreement, Mr Trump said: “Sure, I’m confident, but if we don’t make a very good deal for our country, I wouldn’t make a deal,” Mr Trump said.

China’s expansion has slowed down markedly this year, signalling tough times ahead for its trading partners around the world.