Sterling 'the cheapest foreign currency'

Of all major world currencies, sterling is the cheapest at the moment, the manager of Investec's Managed Currency and Currency Alpha funds has claimed.

According to Investment Week, Tim O'Dell said it would take a large drop in the value of the pound for this position to change.

Indeed, he claimed that sterling would have to lose as much as ten per cent of its value against the dollar in order to be seen as expensive.

He said Investec Asset Management is currently overweight in sterling because of its low price on the foreign exchange markets.

"We maintain our view that sterling is the cheapest of the major currencies," Mr O'Dell remarked.

Sterling fell by more than one per cent against the dollar yesterday (May 25th).

According to Reuters, it fell further this morning (May 26th) as investors grew nervous over signs of tighter liquidity in the money markets.

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Posted by Sarah Pitton