The pound sterling is showing a gradual tilt in the downward direction. The recession or devaluation of a currency means higher inflation. Euro is standing firm whereas pound sterling has lost value, the lowest in two years. ECB will provide the stimuli necessary to revive the lost momentum.
Pound slides just below $1.25. Hard Brexit is playing on the minds of investors. The trade war between the United States and China is showing its impact on pound as well. The investors are losing confidence in the stability of the chemical market as BASF is the latest victim of the trade war.
The German chemical giant, BASF, slashed its annual profits by 30%. Sales will decline and one excepts job cuts. This is not going well with the stability of the British pound.
Pound sterling faces de-valuation
Brexit deal or no deal has shown partial signs of negative growth on the local economy. Levels of uncertainty have raised further amidst a trade war. Investors find it really difficult to streamline their thought process in the state of political enigma and social unrest. Both the factors are entailing the spheres of the UK in recent times. It’s high time that the policymakers provide the impetus necessary to bridge the gap of low confidence. ECB has ensured successive developmental moves in order to strengthen the pound sterling. Further degradation in the value of the pound would mean more inflation. The European central bank chief has denied rumors of artificially pumping up the markets. A tweet from an official ECP account said that ECP is not intended to keep markets happy. Instead, we ought to provide sustainable market solutions to stimulate the real economy.
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