The British pound finished the week of on a sour note on Friday as fresh Brexit fears resurfaced with the prospect of the UK leaving the EU a grim reality.
At close of trade on Friday the British pound ended at US1.4137c, pulling sharply back from above US1.45c a week earlier.
In a frightening prediction the Confederation of British Industry estimated losses of almost 1 million jobs and £100bn if the UK left the EU.
At least £11 billion has been placed so far this year on options that would profit if sterling fell to or below $US1.3502 after the June 23 referendum and the figure is growing daily.
Nick Kounis of ABN Amro Bank was even more pessimistic by predicting that the pound would fall a lot lower than $US1.35 if the UK chooses to exit as the economy drops,
“If a vote to leave resulted in a “messy” divorce from Europe, then the U.K. economy would likely fall into a recession and the pound would drop to about $1.15 by the end of the year” he wrote.
With no important local data out of the UK next week the British pound will be dictated by events from the US such as the unemployment rate and Non-Farm payrolls figure which may put further pressure on the pound if the numbers please investors.
Risk warning: Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, your level of experience and preparation of taking risk. The possibility exists that you could sustain a loss of some or of all of your initial investments and therefore you should not risk more than you are prepared to lose. Please seek independent financial advice if necessary.
|By clicking "Continue" you will be redirected to the website operated by FIBO Group, LTD company registered in BVI and regulated by FSC. Click "Cancel" to remain on this page.|