Pound: growth against forecasts. Overview for 08.12.2022

On Thursday, the British pound against the US dollar is slightly declining, but looks stable, on the whole. The quote is 1.2182.

The pound is taking advantage of the weakness of the USD quite efficiently and remains not far from the peaks of June. Yet indeed, Great Britain and the GBP have quite a bunch of problems that will later need to be accounted for in the exchange rates of the currency.

Under problems we mean further growth of inflation, lagging of the interest rate increase trend of the Bank of England from that of its rivals, and an overall increase in the expenses of consumers and businesses due to the general economic decline.

The Saxo Bank, famous for its all-time excessive expectations, has recently forecast possible resignation of Prime Minister Rishi Sunak. He might then bring his dream to life and create an educative startup. As for Great Britain, in 2023 it might gather a referendum on cancelling Brexit and might start the process back, spending even more money on it.

Naturally, we should not trust blindly the Saxo Bank. However, the advantage of the forecast is highlighting the most acute problems and arguments with reason.