E The GBP Against A Second Lockdown - Is It All Doom And Gloom?

In the times where global investors are experiencing stressful times, their inflows tend to fade and support sterling drops.

The pound has not only fallen owing to investors’ movements, but there is an added issue of raising expectations for a Banks of England interest rate cut with the market’s expectations for a 0.25% interest rate cut at the bank.

The economic recovery continues 

The UK economy is trying to recover and the situation is getting better and better as the world is starting to reopen and the GDP has been increasing little by little. The slowdown in Europe and Brexit will soften the tone in the future month and everyone will see if the UK will be able to keep the pace as the year ends. 

The Bank of England is trying to stabilize everything. However, the last time they tried to affect the GBP exchange rate they joined The European Exchange Rate Mechanism in 1979. They then lost billions to George Soros. His convenient and courageous bet against the Bank of England in 1992 became Black Wednesday for the whole country. With costs of around £3.3 billion, Britain's central bank was incapable of protecting itself from an attack within the currency markets, and Mr. Soros made an estimated $1 billion in profits as a result. Because of it he becomes known as the best forex trader in the world and still retains that title. 

Brexit: What trade deals has the UK done so far?

As everyone already knows, the UK has signed an agreement in principle with Japan which will be marked as its first major trade deal since leaving the European Union. Uk has been free to strike its own deals for buying and selling goods and services around the world. 

What is a Free-trade deal?

A free trade agreement aims to encourage trade by making it cheaper. This often is achieved by reducing tariffs and changing the trading strategies across borders. Trade agreements are removing quotas and limits on the number of goods that can be traded. 

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William K. 2 days ago Member's comment

It seems that the financial group that whose activities brought about the recession in GB evidently have not finished with making random changes in hopes of somehow producing a recovery. Exiting the EU may not provide the desired recovery either, and if not, then what?

The cyclical nature of economies is usually cause by the same sort of things that tend to reduce the stability of all feedback systems. And certainly economies are a feedback system, rather intended or not. Mechanical feedback systems, as used in machinery, are subject to the unchanging laws of physics, and so the requirements for stability can be learned. The "Laws" relative to operation of the financial system and the economy are probably just as unchangeable but much less clear. Or is it that they are much less acknowledged by those folks making the changes?