LONDON — The British pound yesterday fell to near historic-low levels after Chancellor Philip Hammond warned that Brexit negotiations will create a roller-coaster ride for the United Kingdom economy as Prime Minister Theresa May set a March deadline to start divorce proceedings from the European Union (EU).

“We must expect some turbulence as we go through this negotiating process. There will be a period of a couple of years or perhaps even longer when businesses are uncertain about the final state of our relationship with the European Union,” he was quoted by The Telegraph as saying yesterday.

Mr Hammond said it was not possible to be sure whether ending free movement would mean losing access to the single European market.

“We don’t know anything. This is a unique situation. Britain is the second-largest economy in the EU and we are leaving the EU, so we have to forge a new relationship between the British economy and the economies of the EU,” he added.

Against the Singapore dollar, the pound shed as much as 0.9 per cent to an intraday low of S$1.7515 before recovering partially to S$1.7535 mid-afternoon in London. That was barely above its all-time low of S$1.7270 touched on Aug 15, weeks after Britain’s shock decision in a June 23 referendum to leave the EU.

The pound has fallen 16.1 per cent against the Singapore dollar this year, Bloomberg data showed.

“We are back to the Brexit risks,” said Mr Vishnu Varathan, a senior economist at Mizuho Bank in Singapore. “Sterling has taken a bit of a knock first. If the concerns become wider concerns about financial market contagion, we will find that the slight softening that we have seen in the US dollar trend will be shaken off.”

Against its major currency peers, the pound dropped to the weakest level since July 6, the day it reached its 31-year low of US$1.2798. Mid-afternoon in London yesterday, it was trading down 1 per cent at US$1.2840.

The pound’s weakness boosted shares of UK exporters, leading the FTSE 100 about 1 per cent higher mid-afternoon in London.

Earlier in the day, Asian stocks ended higher on a relief rally as worries over the health of European banks eased and Japanese shares climbed on a weakening yen against the US dollar.

Mr Hammond’s comments came a day after UK Prime Minister Theresa May said she would invoke Article 50 of the EU’s Lisbon Treaty — the formal trigger for two years of talks — by the end of March. That offered the first glimpse of a timetable for a divorce that will redefine Britain’s ties with its biggest trading partner, suggesting Brexit could be completed as soon as 2019.

Britain’s shock vote to leave the EU propelled Ms May to power and the former Home Secretary had been under pressure to offer more details on her plan for departure, beyond an often-repeated catchphrase that “Brexit means Brexit”.

In a move to ease fears among her ruling Conservatives that she may delay the divorce, she told the party’s annual conference in Birmingham on Sunday that she was determined to move on with the process and win the “right deal”.

Short positions on the pound, or bets on the currency’s decline, outnumbered bullish wagers by 87,714 contracts last week, US Commodity Futures Trading Commission data showed yesterday. That is the first time that large speculators had raised bearish bets on the currency since the week ended Aug 23, when net wagers for a weaker pound reached a record 94,978 contracts. AGENCIES