GBP/USD can see a brutal sell-off
The GBP/USD has been declining steadly for the last few months, considering Fiscal and Trade Balance Deficit, while the economy it's very dependent on foreign inflows, to finance it's debt. The British figures of outstanding debt are astonishing and speak of a debt bubble economy fuelled by a fraudulent hyperinflated bubble in Commercial Real Estate and Housing market.
more than $6.0 Trillion dollars are in external debt, which are not the net figures, however , Sterling denominated Corporate Debt rose to £1.6 Trillion Pound, while also the Government borrowed debt has reached and passed the 100% debt/gdp ratio. With these macro economic factors, primary and secondary account deficit imbalances, while the economy fuels on growing Corporate Debt, the British Pound would be forced to depreciate even further to find a new equilibrium exchange rate. The next brutal sell-off, could be on the cards in the coming months, while GBP/USD going to reprice -8.0% from GBP/USD 1.30 to GBP/USD 1.20. In the longer terms it's could be very possible an exchange rate parity on GBP/USD.
more than $6.0 Trillion dollars are in external debt, which are not the net figures, however , Sterling denominated Corporate Debt rose to £1.6 Trillion Pound, while also the Government borrowed debt has reached and passed the 100% debt/gdp ratio. With these macro economic factors, primary and secondary account deficit imbalances, while the economy fuels on growing Corporate Debt, the British Pound would be forced to depreciate even further to find a new equilibrium exchange rate. The next brutal sell-off, could be on the cards in the coming months, while GBP/USD going to reprice -8.0% from GBP/USD 1.30 to GBP/USD 1.20. In the longer terms it's could be very possible an exchange rate parity on GBP/USD.