Sterling was down in early morning trading after US President Donald Trump's commented on his visit to the UK that a "soft" Brexit, as signalled in the white paper released on Thursday, would "kill" any chances of a trade deal being made with the US.
Along with suggesting her Brexit strategy, which was put together last week, was the wrong way to go, he accused Prime Minister Theresa May of ignoring his advice on how to handle the negotiations during his ongoing visit to the UK.
"I would have done it much differently. I actually told Theresa May how to do it, but she did not agree, she did not listen to me. She wanted to go a different route," Trump said.
He also questioned whether May was putting together the same Brexit strategy the UK population voted on in June 2016.
"The deal she is striking is a much different deal than the one the people voted on. It was not the deal that was in the referendum. I have just been hearing this over the last three days. I know they have had a lot of resignations. So a lot of people do not like it."
Furthermore, Trump openly undermined May by claiming former Foreign Secretary Boris Johnson, who quit following the Chequers deal, would make a great Prime Minister.
"If they do a deal like that, we would be dealing with the European Union instead of dealing with the UK, so it will probably kill the deal. If they do that, then their trade deal with the US will probably not be made," Trump continued.
"We have enough difficulty with the European Union. We are cracking down right now on the EU because they have not treated the US fairly on trading."
On the news, sterling fell 0.3% against the US dollar to $1.317 while against the euro it was down 0.2% to €1.1298.
Trump's comments will add to growing pressure surrounding May who has seen two members of her Cabinet depart following her meeting at Chequers last week, which finalised the government's Brexit strategy.
On Thursday, the government released its Brexit white paper in which it backed down from its calls for mutual regulatory recognition post-Brexit and will now push for a deal that will see UK and EU financial services firms' access to each other's markets scaled back when the country leaves the bloc.
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