Goldman Says Pound Is G10’s Most Overvalued Currency, With Brexit Cutting Fair Value 6%
Updated
Updated · Bloomberg · Jun 19
Goldman Says Pound Is G10’s Most Overvalued Currency, With Brexit Cutting Fair Value 6%
2 articles · Updated · Bloomberg · Jun 19
Summary
Sterling faces growing pressure after Goldman Sachs said its post-Brexit rebound has left it the most overvalued currency in the G10.
A 6% Brexit hit to the pound’s fair value is still embedded in Goldman’s model, but the currency has recovered strongly in real terms and overshot those fundamentals.
The call suggests further downside risk for sterling if markets begin to price it closer to Goldman’s estimate of fair value rather than its recent rally.