Sterling is on the cusp on the historic move and speculators have already chosen which side they prefer
Theresa May would have to convenience the Cabinet that it is the best deal that the UK can get not that this is the best deal she can get. If she fails in her task, we could see some serious sell off for sterling.
How serious this could be? Well, we could easily touch the level of 1.27 (aginst the dollar) if she fails to achieve anything. Moreover, there is a serious risk that she may be asked to step down from her position and leave the position for the person who can actually deliver a hard Brexit. But, the reality is that hard Brexit would be extremely bad for the U.K’s economy and perhaps any sensible leader will not make this choice.
He or she may just choose to go ahead with another referendum option. If there is another referendum, the odds are in favour of no Brexit. The public is really fed up with this circus. Such an event would be positive for sterling and for the FTSE 100 index. As for the issue of having a control over immigration, the main reason for Brexit, the previous government and the current government already have a good grip on this. We do not need Brexit to control this, it is fairly controllable without leaving the European Union.
Nonetheless, for now, the pound volatility has touched a critical level, something which we have not seen going back all the way to June 2017. The net speculator’s positions show that they have reduced their short position as compared to September however, the most recent action tells us, traders are putting more short bets.
Nonetheless, for now, the pound volatility has touched a critical level, something which we have not seen going back all the way to June 2017. The net speculator’s positions show that they have reduced their short position as compared to September however, the most recent action tells us, traders are putting more short bets.
