Pound Sterling Being Slaughtered, as Prospects Are ‘Truly Alarming’
Aug. 21, 2022 (EIRNS)—The global policies adopted by the City of London and their Wall Street sidekicks are rapidly sinking Great Britain itself and the pound sterling into poor country status. An article yesterday in the Toronto-based Financial Post, which is part of the Hollinger empire, reports that the U.K.’s latest reports of double-digit (and rising) inflation have caused a run on the pound sterling, even as speculators are betting that the Bank of England will more than double its key rate to 3.75% by March from 1.75% currently.
Speculators “stayed resolutely bearish on the [British] currency versus the U.S. dollar,” the Financial Post reported, and “they also piled into hedges against higher consumer prices, betting the worst is still to come... Sterling has dropped against both the euro and the dollar so far this month, even as the rise in U.K. bond yields outstrips other markets.”
This is banana republic stuff, Adam Cole, currency strategist at RBC Capital Markets, commented gloomily. “This kind of breakdown in the correlation between currency and yield shifts is typically associated with emerging-market currencies,” Cole said, according to the Financial Post.