The British pound ended the second quarter of 2022 below $1.22, and is down more than 10% in the first half of the year, which is the worst six-month performance since 2016, the year of the Brexit referendum. A general dollar strenght, mounting recession fears, soaring inflation rates and a fall in UK's living standards have been pushing the pound down. At the same time, investors remain concerned about the ability of the central bank to rein in inflation without severely damaging the economy. The BoE has raised rates five times since December when it became the first major central bank to increase rates after the COVID-19 pandemic, and rates now stand at 1.25%, the highest in 13 years. Still, the inflation rate continues to increase to reach 1982-highs and the economy already contracted 0.3% in April and 0.1% in March.
Historically, the British Pound reached an all time high of 2.86 in December of 1957. British Pound - data, forecasts, historical chart - was last updated on July of 2022.
The British Pound is expected to trade at 1.20 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 1.17 in 12 months time.