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The rally in the pound triggered by news of a Brexit agreement has failed to last following concerns that the deal could still be scuppered.

Sterling had surged to a five-month high against the dollar, coming close to $1.30, after the UK and EU’s negotiating teams agreed a deal.

However, the pound began to lose ground after Northern Irish party the DUP said it would not vote for the deal.

By early afternoon, sterling had fallen back below $1.28.

There was a similar pattern against the euro. At first the pound jumped above €1.16, before falling back to stand at €1.1525.

Worries about the possibility of the UK leaving the EU without a deal have been weighing on the value of the pound, as markets view a no-deal Brexit scenario as damaging for the UK’s economy.

Sterling has risen in value whenever there have been signs that a deal could be reached. Read more

Read also: DUP blasts Boris Johnson’s Brexit deal with warning that the party is ‘unable’ to back anything that undermines the ‘integrity’ of the United Kingdom