Markets may be underpricing Brexit risk

‘We don’t see a situation where the UK is going to come out of this with a favourable deal’ – Mizuho currency strategist Sireen Harajli

I’m leaving: the UK is still trying to work out the terms of its departure from the EU

The markets are not paying enough attention to the UK’s negotiations to leave the European Union and they are underpricing the potential impact of Brexit on the UK economy, says Sireen Harajli, a currency strategist at Mizuho.

Harajli does not believe the UK will walk away from the negotiating table with a favourable deal. As a result, she projects the pound could decline to 1.24 at the end of the year; a range not seen since January 2017, ahead of Prime Minister Theresa May’s Brexit speech.

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