Bank of America gave five reasons for the rise of the pound sterling in the coming period and considers it a favorite over many other major currencies, and the bank cited these reasons:-
- Excessive negative views on the UK economy are fading.
- The UK remains a largely underinvested sector, that is, it is undervalued in terms of asset allocation.
- The currency remains fundamentally undervalued.
- The political background is more favorable.
- There is a more positive view of relations between the UK and the EU.
Another reason from our point of view, the faster cuts by the Fed compared to the Bank of England may also be supportive of the rise of the pound sterling, especially against the US dollar.
