British Chancellor Philip Hammond threatens European Union with aggressive tax changes after Brexit

Mr Trump said in an interview with The Times newspaper that Britain leaving the European Union would “end up as a great thing” and promised to work for a trade deal with post-Brexit Britain “quickly and done properly”.

Sterling touched as low as under $1.20 U.S. per pound on Monday, its lowest level since 1985.

The British unit has since recovered some ground to sit around US$1.2044 at 9.00am (2400 GMT), still down from US$1.2197 at 1800 GMT Friday.

Conservative MP Dominic Raab, who campaigned for a Leave vote, said it was “highly likely” the United Kingdom would leave the formal structures of the single market and the customs union, saying it was vital for Mrs May to convey a “positive case” for Brexit.

The pound sterling hit a 32-year low Monday, trading below the U.S.$1.20 mark in advance of a Tuesday speech in which British prime minister Theresa May is expected to announce the country will leave the European Union common market as part of the government’s Brexit plan.

With May expected to trigger Article 50 by the end of March, which will start formal European Union separation proceedings, the battle lines are already being drawn.

On Russia: Trump signaled that he could offer relaxing sanctions imposed against Moscow if the latter agrees to a deal to reduce the stockpile of nuclear weapons.

He forecast other countries would leave the 28-nation bloc, which he described as a “vehicle for Germany”, and said leaving would be good for Britain.

“This will be a speech about setting out the role we are going to forge for Britain as we leave the European Union, our greater role in the world and how we carve a role for ourselves as a global Britain”, A Downing Street source said.

“It’s looking more and more like a “hard” Brexit is in the offing and markets are responding”, said Neil Wilson, senior market analyst at ETX Capital.

Ahead of May’s major speech on Brexit due on Tuesday, No.10 insisted that it had not been behind remarks that a “market correction” was expected on sterling.

After Ukip leader Nigel Farage and Mr Gove, she will be only the third British politician to meet the new US President face-to-face.

Fed Chair Janet Yellen will have an opportunity to lay out her thinking with speeches on monetary policy scheduled for both Wednesday and Thursday this week.

On the possibility of a USA -U.K. trade deal, he told the Sunday Times: “We’re gonna work very hard to get it done quickly and done properly”. By 1630 GMT on Monday, it was down nearly 1 per cent at $US1.2055 and 0.6 per cent at 87.90 pence per euro, while demand to hedge volatility was at its highest since July.

Downing Street said Sunday May in her speech would call on Britons to reject the acrimony and “insults” of past year and “unite to make a success of Brexit” for a “truly global Britain” and focus on a “Britain outside the European Union”.

The pound has previously been prone to outsized swings during Asian trading, with the most extreme being October’s flash crash, which saw the currency tumble more than 6 percent in a matter of minutes.