Britain's pound drops to 31-year low as Brexit fallout continues

LONDON, July 6 (UPI) -- Britain's pound fell to a 31-year low against the U.S. dollar Wednesday as uncertainty continued following the country's decision to leave the European Union.

At one stage, sterling slipped to $1.2798, its lowest value since 1985, before rebounding later in the day.

The Britain's FTSE 100 share index was down 1.6 percent in afternoon trading, while U.S. stocks opened lower on Wall Street.

"There's a lot of nervousness in the sterling market," said Thu Lan Nguyen, a currency strategist at Commerzbank AG in Frankfurt.

Analysts blamed warnings from the Bank of England that Brexit risks were "crystallizing" and fears about the British commercial property market.

The pound has dropped by about 14 percent against the dollar since hitting $1.50 ahead of the Brexit vote on June 23.

Against the euro, the pound was down 0.5 percent at 1.17 euro, having earlier hit its lowest level since 2013.

"Pessimistic predictions for sterling are coming true," said Andrew Edwards, chief executive of ETX Capital. "The pound is the chief proxy for the post-Brexit mood in the markets."