, Columnist
Cheap Sterling Has Reasons to Be Cheaper
The British currency is suffering because of the U.K.'s vulnerability from being a services economy and lacking a safe-haven crisis. A near-term reversal is hard to see.
The value of the pound in Britons pockets is falling sharply relative to the dollar.
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Sterling is trading at its lowest level against the dollar since 1985. It is at a record low against the Swiss Franc. The drivers of the pound’s newfound and sudden decline are substantial.
The currency fleetingly enjoyed some upward momentum after December’s decisive U.K. general election. Traders upped their exposure expecting a rally in the wake of this month’s budget. Those positions are doubtless being unwound.