British Pound Will Surge to Strongest in 26 Years, Brown Brothers Predicts

(Bloomberg) -- The British pound, having broken above $2, is set to extend its rally in coming weeks to the strongest since 1981, as central-bank buying of the currency propels it higher, according to Brown Brothers Harriman & Co.

Central banks will purchase pounds sterling as they diversify their swelling foreign-exchange reserves away from the U.S. dollar and as speculation of higher interest rates in the U.K. boosts returns on pound-denominated investments, said Marc Chandler, head of currency strategy at Brown Brothers.


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