“‘Covid has been a convenient detractor from the Brexit hit,’ said Mike Riddell, who manages more than $10 billion at Allianz in London. He’s short the pound and closely watching how the economy fares when the government’s furlough payments, which supported people out of work during the pandemic, end this month. The UK has suffered a ‘nasty cocktail of a bad Covid hit and Brexit,’ he said.”
The UK’s supply-chain crisis, spiralling energy costs and limp economy are taking a toll on investor sentiment. Both the pound and FTSE 100 Index have trailed market benchmarks since June, and derivatives show that bearishness is now seeping through investor consciousness.