American financial institutions predict that the pound will be equal to the dollar by the end of 2022.
Bank of America expects the pound sterling to fall against the dollar amid instability in the UK economy over the past week. This was reported by Bloomberg news agency.
“Draft” calculations of the consequences of the British government’s new monetary policy have not helped to boost investor confidence in Britain, US bank strategist Kamal Sharma said in a note to clients.
He also noted that rising borrowing costs are putting pressure on public finances.
Bank of America has become the third Wall Street bank to recommend betting on sterling parity before the end of the year.
Similar recommendations were previously published by Morgan Stanley and Citigroup Inc.
Higher inflation, coupled with a stagnant economy, will further weaken the pound, which is now trading at around $1.08 after hitting a record low on Monday, September 26, Sharma said.
The British government, however, continues to stick to its fiscal plans. Prime Minister Liz Truss has defended her tax cut policy.
The official links the “selling” of government bonds by investors to factors of economic economic pressure.
As previously reported, the pound sterling on Monday, September 26, fell to a record low. The euro also hit a new 20-year low against the dollar.
In addition, the dollar exchange rate on the cash market continues to grow in Ukraine: on September 21, the Hryvnia exchange rate reached 42.8 per dollar.
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Source: korrespondent
I am Dylan Hudson, a dedicated and experienced journalist in the news industry. I have been working for Buna Times, as an author since 2018. My expertise lies in covering sports sections of the website and providing readers with reliable information on current sporting events.