Forecaster expects pound to climb 6% by end of 2019

One of the pound’s most accurate forecasters is also one of the most bullish on the currency, predicting a rebound on expectations that Britain will miss the latest deadline for leaving the European Union. The pound will climb about 6 per cent to $1.33 by the end of the year according to Svenska Handelsbanken AB, which was among the most accurate forecasters on the pound for the past three quarters. Kiran Sakaria, a 28-year-old strategist at the Swedish firm, said its assessments are strengthened by its distance from the daily churn of Britain’s political drama, and a focus on economic fundamentals instead.

“We don’t sit in London like many of our competitors and perhaps this is a key factor,” he said in an interview. “Even though we follow the British newspapers, Brexit is not as apparent in Sweden.”

Handelsbanken successfully predicted that Brexit would be delayed beyond its original March 29 deadline, which triggered a fall in the pound the following month on the heightened chances of a no-deal Brexit. This time around, Sakaria detects a different dynamic, with most of the bad news already priced in for sterling and the dollar outlook beginning to turn.