UNITED STATES (VOP TODAY NEWS) — A sharp jump in the pound sterling is almost completely leveled. Optimism regarding the British currency is exaggerated, experts say.
It is too early to bet on the optimistic results of Brexit, buying a pound sterling, warns the world’s largest private wealth management company.
The pound in 2019 shows the best results among the major currencies, but UBS Global Wealth Management advises investors “not to chase his rally.” The options market now suggests that traders expect increased volatility in the short term: the threat of Brexit without an agreement is not yet completely ruled out, writes Bloomberg.
“The road ahead remains foggy and bumpy,” Daniel Tram and other strategists at UBS Group AG wrote in the review. “Downside risks, such as lack of a deal and general elections, remain relevant.”
Since the beginning of the year, the pound has risen in price by more than 3%, now the pound / dollar pair is trading above the $ 1.32 level, as traders cut rates on the UK leaving the European Union without an agreement.
Although the UBS baseline scenario implies that the deal will ultimately be concluded after postponing Brexit scheduled for March 29, he predicts a decline in the British currency in the next three months to $ 1.28 per euro.
“At the moment, we are neutral on the pound sterling and we believe that tactical long positions on the pound will again become attractive only at or below $ 1.24 or at or above 92 pence per euro,” said Maximilian Kunkel, strategist at UBS. managed assets of $ 2.26 trillion.
On the eve of the House of Commons rejected the option of leaving the UK from the EU without a deal. Today a vote will be held on the postponement, but the process is difficult, most likely, the British authorities will again vote on the deal, although there is a possibility of a repeated referendum, but it is currently extremely small.
May’s warning of the long postponement, which is included in the proposal for Thursday’s debate, is a tactical move aimed at convincing conservative supporters of Brexit and their allies in the Democratic Unionist Party of Northern Ireland to support the deal before it is too late.
A long delay could potentially clear the way for a second referendum, which may override the results of the first.
This article is written and prepared by our foreign editors writing for VOP from different countries around the world – edited and published by VOP staff in our newsroom.
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