Pound Flash Crash Had No Single Trigger, BIS Investigation Finds
- Time of day, stop-losses and expertise of staff played a role
- Financial institutions didn’t face losses, according to BIS
What's Behind the British Pound's Flash Crash
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The Bank for International Settlements found no single smoking gun in its investigation of the pound’s flash crash, instead suggesting factors ranging from the time of day to the lack of expertise of staff as the reasons behind the currency’s sudden plunge.
Sterling tumbled more than 6 percent in the space of two minutes in overnight trading on Oct. 7, with data compiled by Bloomberg showing it touched $1.1841, the lowest level in 31 years. The flash crash in the world’s third most-traded currency pair added to the woes of a beleaguered pound that has fallen 18 percent since the U.K’s June vote to leave the European Union.