Has The Crown Already Slipped? What’s GBP’s Status Today?

The Future of the Sterling

“We believe Sterling is in the process of evolving into a currency that resembles the underlying reality of the British economy: small and shrinking with a growing dual deficit problem similar to more liquid (emerging market) currencies.”

The GBP Trajectory So Far — A Volatile Currency

Negatives Piling Up Against the GBP

  • A second wave of coronavirus infections in the US and China is threatening the UK and the global economy.
  • Insistence of PM Johnson to not extend the 12-month transition period, which means that the UK will leave without a trade deal, if it has to. This will impact UK businesses and the economy massively.
  • The UK can get caught in the middle of rising US-China trade tensions.
  • US Presidential election is scheduled for November 2020. While President Trump is a Brexit supporter, his challenger, Joe Biden, isn’t. This will make the UK’s attempts at bilateral trade talks with the US trickier.
  • The Bank of England’s indication to go into the negative interest rate zone.
  • The UK’s massive trade deficit, which could be wider than some countries, like Turkey and South Africa, by 2021.
  • Risk of persistently high unemployment rate in the UK.

London’s Battle to Remain the Global Financial Hub

What Will it Mean for Forex Brokers and Traders?

Low Sterling Rates Good for Foreign Investments

We Asked Finance Pro Andrew Saks-McLeod from Finance Feeds https://financefeeds.com/

1. What is the biggest challenge for the pound right now?

2. What advice would you give traders wanting to trade it?

3. Where do you think its heading in the next couple of months?

We also asked TIOMarkets Chief of Risk, Dave Hannigan https://tiomarkets.com/

1. What is the biggest challenge for the pound right now?

2. What advice would you give traders?

3. Where do you think its heading in the next couple of months?

4. Any final comments?

We asked Peter Bukov, Axiory Analyst www.axiory.com/

1. What is the biggest challenge for the pound right now?

2. Where do you think its heading in the next couple of months?

3. What advice would you give traders wanting to trade it?

Thank you to Andrew, Dave and Peter for your input!

What’s hot in trading this week?

Reference Sources:

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