Larry Summers Says Pound Troubles are Not Over as Brexit Looms

“The decline in the pound is like a fever,” according to former Treasury Secretary Larry Summers.

“It’s a sign of some serious problems that are associated with the Brexit strategy,” he told CNBC on Monday evening.

The famed American economist’s comments follow a torrid start to the month for the British currency with sterling now down around 5 percent against the U.S. dollar so far in October and hovering at lows unseen since the mid-1980s.

The current level of around $1.23 per British pound is off the lows of around $1.14 seen last Friday when the currency plummeted under circumstances still under investigation by the Bank of England but widely suspected to be linked to algorithmic trading patterns.

Summers is not alone in positing that the worst may not be over as Britain inches towards the March 2017 deadline Prime Minister Theresa May has set for triggering “Article 50” and thereby the official start of the U.K.’s withdrawal from the European Union.

via CNBC

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza