"Investors have been caught wrong-footed,” said Mazen Issa, a senior foreign-exchange strategist at Toronto-Dominion Bank in New York.
“The downside potential is still rather prominent from our perspective.”
A major catalyst in the change in analysts’ forecasts came on Friday, when sterling plunged 6.1 percent versus the dollar in two minutes during Asian trading.
While that move was blamed on possible human error and algorithms at a time when liquidity was scarce, it was enough to prompt strategists to reassess their longer-term view.
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