The british pound collapses – The Point

The british pound has suffered a crash of lightning Friday at the start of trade in Asia, brokers confused referring to technical reasons or human error, on fears of a “Brexit hard” revived by the words of François Hollande. Shortly after 8 a.m. in Tokyo, the pound sterling has occasionally dropped to 1,1841 dollar, a new low since 1985, before recovering to around 1.24 dollar. It was two hours earlier 1,2614 dollar, a sharp sell-off of 6.1 %. In respect of the euro, it has experienced a dip similar : the single currency has reached 94,15 pence at the same time, a level unprecedented since early 2009, against 88,42 pence to 21 hours.

The book had not been so shaken since the announcement on 23 June the results of the referendum on the Brexit, which had caused all the chaos on the global financial markets and plunge the pound by more than 10 %. She was already under heavy pressure this week, following the announcement by the british Prime minister, Theresa May, to launch by the end of march 2017 of the exit procedure of the european Union by the United Kingdom. But then to plummet so much… “What happened was foolish – call it a crash, lightning – fast, but movements of this magnitude shows how far the currency may go down,” responded Naeem Aslam, analyst at Think Markets, in a note cited by Bloomberg News. “The pound sterling is haunted by fears of a “Brexit” hard “.

” Inevitable “

brokers have advanced technical factors in order to explain the downfall. “It would seem that a series of automatic orders have fallen at the same time, probably due to technical reasons, which caused the downfall of the book in a period of low activity before the release of u.s. employment figures “, and later on in the day, ” said Minori Uchida, head of foreign exchange at Bank of Tokyo-Mitsubishi UFJ.

Some have even raised the possibility of a ” fat finger “, the clumsiness, involuntary of one man. But others felt that this crash was inevitable, then, that draws the prospect of a divorce without any compromise on the economic plan with Brussels, which would be the worst scenario for the business community, with the key being the possible loss of access to the single market. “It was only a matter of time before a flip-in such a plunge,” said Yosuke Hosokawa, Sumitomo Mitsui Trust Bank. “The negative elements are accumulated until the dam bursts. We have not yet seen the worst, the record of 31 years [against the dollar] can now be beaten. “

the statements of The French president François Hollande, who has pleaded Thursday night for the “firmness” in the face of London in the future negotiations, have been able to play a role trigger, argued analysts. “It is necessary that there is a threat, it is necessary that there is a risk, it is necessary that there is a price, otherwise we will be in a negotiation that can not be completed, and which, necessarily, will have consequences for economic and human “, launched Holland Holland in a speech in Paris. “The Uk has decided to Brexit, I believe even Brexit hard, well, it is necessary to go to the end of the willingness of the British to get out of the european Union,” stressed the head of State.