2016.10.0301:52:00UTC+00Pound Extends Drop After UK PM Theresa Sets Brexit Deadline

The British pound continued to be weak against most major currencies in the Asian session on Monday, after British Prime Minister Theresa May said that she will start the process for the U.K. to leave the European Union in the first quarter of 2017.

Speaking to the delegates at her Conservative Party's annual conference on Sunday, British Prime Minister Theresa May said that she'll invoke Article 50 of the EU's Lisbon Treaty by the end of the first quarter of 2017.

Meanwhile, traders speculate that the Bank of England is likely to cut interest rates further.

Crude for November delivery is currently down 0.33 percent to $47.91 per barrel. The crude oil prices dropped due to over-supply, as the Organization of the Petroleum Exporting Countries or OPEC's rival members like Saudi Arabia, Iran, and Iraq are reluctant to agree an agreement of last week by exporters to follow through with supply quotas.

Last Friday, the pound dropped 0.03 percent against the euro, 0.49 percent against the Swiss franc, 0.03 percent against the U.S. dollar and 0.25 percent against the yen.

In the Asian trading, the pound fell to more a than 1-1/2-month low of 1.2913 against the U.S. dollar and a 1-week low of 0.8694 against the euro, from Friday's closing quotes of 1.2972 and 0.8655, respectively. If the pound extends its downtrend, it is likely to find support around 1.27 against the greenback and 0.88 against the euro.

The pound edged down to 1.2528 against the Swiss franc, from Friday's closing value of 1.2587. The pound may test support near the 1.23 region.

Meanwhile, the pound rose to 131.49 against the yen, from an early low of 130.63. On the upside, 130.00 is seen as the next resistance level for the pound.

Looking ahead, Swiss retail sales data for August and PMI reports from major European economies for September are due to be released later in the day.

In the New York session, U.S. final manufacturing PMI for September, construction spending for August, U.S. ISM manufacturing PMI data for September, and Canada RBC manufacturing PMI for September are slated for release.

Chinese banks will be closed in observance of National Day holiday and German banks will be closed in observance of German Unity Day holiday.