Sterling would rocket by at least 4 per cent if parliament can agree on Prime Minister Theresa May’s Brexit proposals in a scheduled vote next week, JP Morgan Asset Management has said.
The bank’s asset management division has also warned about the potential impact of extending Article 50, a suggestion that government has previously ruled out.
According to JP Morgan, extending Article 50 would lead firms to “choose other countries over the UK” to build their businesses and could potentially lead to “a death by a thousand cuts”, the Telegraph reported.
JP Morgan Asset Management EMEA chief market strategist Karen Ward said avoiding a no-deal Brexit would allow the Bank of England (BoE) to increase interest rates, therefore pushing sterling upwards.
Speaking to the telegraph, Ward said that extending Article 50 would create a “worst-case scenario” situation, stating that she does not “see what it provides us in reaching a clear, final outcome that provides certainty for business”.
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