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At this point the falling pound is a one way bet. The Bank of England has been incredibly slow in dealing with inflationary issues in the UK, raising interest r
by drumhead 4y ago
At this point the falling pound is a one way bet. The Bank of England has been incredibly slow in dealing with inflationary issues in the UK, raising interest rates by only .25 percent when inflation was rocketing. The pounds been falling for a few months and they've made no effort to prop it up.
The dollar is extremely strong, but the bank has been sleeping on the job a bit as well. They're going to have to raise rates sharply because it's become such a no brainer short now. But hey, at least UK interest rates are returning to trend now.
- fmajid 4y agoThe pound has fallen against almost every currency, not just the dollar. It's almost as if you can't run Reagan-style deficit spending when you don't control the world's reserve currency.
- drumhead 4y agoA large part of the deficit is due to the Energy cost relief program, something the government had to do. The BoE knew this but chose not to raise rates to compensate, so either they're happy with the situation or they're dithering.