Analysts say there are a lot of bearish times for the British pound, focusing on the pound against the euro. The common opinion is that it is possible that the pounds will fall against the euro to levels unprecedented by 2017. The reason - the unbroken Brexit saga and dovish ECB.
Sterling may fall to 0.92 for one euro by the end of the year, with JPMorgan forecasting a 3% drop in price for the first for 21 months. Pessimism around the currency begins to dominate and be valued in the options market.
The pound remains under intense pressure, given the political uncertainty in the country and the approaching deadline for Brexit in October. The decline also reflects investors' skepticism about Bank of England's position to raise interest rates if the economy develops as expected. With the slowdown in the global economy, in fact, market players are beginning to see a reduction in interest rates by BoE in 2020.
Since early April, pounds have depreciated by 4%. The situation is that most likely shorts in pounds will continue to increase.
Source: Bloomberg Finance L.P.
Graphs: Used with permission of Bloomberg Finance L.P.
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