Brexit unlikely to affect sterling’s reserve currency status

No-deal scenario could put major downward pressure on the currency

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Sterling exposure: the currency’s weakness has not triggered a fundamental rethink among reserve managers

The economic instability created by the UK’s departure from the European Union is unlikely to affect sterling’s popularity as a reserve currency, analysts tell Central Banking.

On January 15, the House of Commons rejected a draft agreement by the UK government and the EU, leaving the Brexit process highly uncertain.

It is still unknown how aligned the UK economy will be with the common market, if at all, and when Brexit will take place. Even remaining in the EU is not impossible at this point.

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