BOE deputy governor Bean says the fall in the effective sterling rate this year may reflect the tendency of financial markets to overshoot.
FX rates are particularly prone to overshoot, So I’d never argue with his logic. Anyone remember EUR/USD at 1.60?
One the other hand, the economist in Bean says that the general direction for the pound (down) has been the right one.
Cable trades at 1.4260, off earlier highs just above 1.4300. Cable remains extremely volatile trading up close to 1.5000 little more than a week ago.
