“Pound Sterling remains at risk,” says George Saravelos, an analyst at Deutsche Bank. The pound has lost about 7% against the dollar in the past 10 days due to a massive support package for the British to help them cope with energy prices. It is a £150 billion project over two years. It’s really huge.
British government bond “gilts” rates are huge, flying high and now reaching 3.84%, which will complicate debt servicing.
If markets no longer want to lend to borrowing countries, there is only one solution.
Bring on the central bank, the Bank of England.
And then inflation then hyperinflation and finally the destruction of the currency.
Deutsche Bank analyst George Saravelos may be worried about the pound sterling, but he could be worried about the euro and all countries in the eurozone. Our economy is no better than English economy.
We will soon have to deal with the same problems and the euro, moreover, is falling hard against the dollar.
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