{"id":170774,"date":"2020-05-19T10:15:16","date_gmt":"2020-05-19T14:15:16","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=170774"},"modified":"2020-05-19T08:02:12","modified_gmt":"2020-05-19T12:02:12","slug":"pound-could-drop-even-further-to-1-18-in-june-devere-ceo","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/05\/pound-could-drop-even-further-to-1-18-in-june-devere-ceo\/","title":{"rendered":"Pound could drop even further – to $1.18 – in June: deVere CEO"},"content":{"rendered":"
May 19, 2020<\/div>
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By George Prior<\/strong><\/p>\n

The British pound \u2013 this month\u2019s worst-performing major currency \u2013 could \u201ceasily drop to $1.18\u201d at the end of June, warns the CEO of one of the world\u2019s largest independent financial advisory and fintech organizations.<\/p>\n

The warnings from deVere Group\u2019s chief executive and founder Nigel Green come as it is revealed that the British currency shed almost 4% against the U.S. dollar in May and 3% against the euro.<\/p>\n

Mr Green comments: \u201cThe pound is this year\u2019s third-weakest major currency \u2013 just behind the New Zealand dollar and Norwegian krone, which have done even worse.<\/p>\n

\u201cThe pound has been battered since the Brexit referendum in 2016 and the ensuing years of political uncertainty, losing around 20% of its value since the referendum.<\/p>\n

\u201cThe Covid-19 crisis has been another hammer blow for sterling as it promoted a flight-to-safety and ramped-up the search for liquidity.\u00a0 This situation is a win for the U.S. dollar and, in turn, a loss for the pound.\u201d<\/p>

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He continues: \u201cThere are legitimate concerns that the pound has further to fall in the next few weeks.<\/p>\n

\u201cIt could easily drop to $1.18 by the end of June due to renewed and heightened fears of a negative shock due to a no-deal Brexit combined with the far-reaching economic fallout of the pandemic.\u201d<\/p>\n

Negotiations between the UK and the EU on their post-Brexit future relationship stalled on Friday with the EU\u2019s chief negotiator Michel Barnier saying the two sides risked reaching a \u201cstalemate.\u201d<\/p>\n

The British Prime Minister Boris Johnson has repeatedly threatened to walk away from the talks if insufficient progress has been made by next month\u2019s high-level negotiations. The UK has indicated the alternative of an \u201cAustralia-style\u201d deal, a relationship where both sides trade on basic World Trade Organization terms, similar to a no-deal Brexit.<\/p>\n

\u201cAn even weaker pound will help to reduce people\u2019s purchasing power and a drop in UK living standards. Weaker sterling means imports are more expensive, with rising costs being passed on to consumers,\u201d says Mr Green.<\/p>\n

\u201cThe fall in the pound is good for exports some claim, but it must be remembered that around 50% of UK exports rely on imported components. These will become more expensive as the pound falls in value.<\/p>\n

\u201cA low pound is, of course, bad news for British expats, amongst others, who receive income or pensions in sterling.<\/p>\n

\u201cThe country\u2019s financial services sector \u2013 which represents 6% of all economic activity – will also be adversely affected because it is built on foreign investment that puts its faith in sterling being strong.\u201d<\/p>\n

The deVere CEO concludes: \u201cThe pound will remain volatile, and is likely to become weaker in the next month.<\/p>\n

\u201cAs such, it can be expected that domestic and international investors in UK assets will be seeking the available international options available to them.\u201d<\/p>\n

About:<\/strong><\/p>\n

deVere Group is one of the world\u2019s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.\u00a0 It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

By George Prior The British pound \u2013 this month\u2019s worst-performing major currency \u2013 could \u201ceasily drop to $1.18\u201d at the end of June, warns the CEO of one of the world\u2019s largest independent financial advisory and fintech organizations. The warnings from deVere Group\u2019s chief executive and founder Nigel Green come as it is revealed that […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-170774","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170774","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=170774"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170774\/revisions"}],"predecessor-version":[{"id":170775,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170774\/revisions\/170775"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=170774"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=170774"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=170774"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}