The British pound’s powerful rally over the past year seems to have come to an abrupt end and Capital Economics told CNBC the currency faces a further drubbing this year.
The pound rallied 15 percent to a high of $1.7191 in early July from July 2013, on expectations that U.K. central bankers were poised to hike rates for the first time since 2007. However, it has fallen around 2 percent over the past month to trade at $1.6855 in early Asian trade on Thursday.
According to economists at Capital Economics, the recent declines have been motivated by shifting rate hike expectations for both the U.K. and the U.S. “Investors still seem to be expecting interest rates to rise more quickly in the U.K. than in the U.S.,” said Capital Economics in a note published Wednesday.
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Latest posts by marketpulsefxstaff (see all)
- Oil Remains Near Multi-Month Lows - 6 August 2015
- U.S. Dollar Higher on Recent Data - 6 August 2015
- Greece’s PM Tsipras: Loan Deal with Lenders Close - 6 August 2015