"Report": Decline of euro and UK pound will continue

"Report": Decline of euro and UK pound will continue
Fed may raise its benchmark interest rate at the next meeting

Baku. 24 June. REPORT.AZ/ Voting results on withdrawal of Great Britain from the European Union (EU) have a negative impact on the currency of both regions. The euro and the pound sterling in the global market sharply reduced.

Analytical Group of Report News Agency considers that the process of devaluation of both currencies will continue. Withdrawal of the UK from the EU assistance to various social programs, slowing inflow of cheap labor from the EU, a change in trade quotas and other economic factors will lead to a further decline of the pound sterling.

Brexit will create more serious problems for the Eurozone. The reasons for the depreciation of the euro associated with the possibility of exit from the EU's other members, that can destroy the EU. This week in Italy, there were calls for a referendum on the refusal of the single European currency.

After yesterday's referendum, the pound fell against the dollar by 12% and reached 1,3231 USD/GBP, but then there was an increase to 1,36 USD/GBP. The euro initially fell by 4.5% to 1,0913 USD/EUR, then rose to 1,1030 USD/EUR. Analytical Group of Report News Agency predicts the decline of the pound sterling to 1,20-1,25 USD/GBP, and the euro in the short term to reach 1,05 USD/EUR.

Notably, taking into account the results of Brexit, as well as the positive trends in the economy US Federal Reserve (Fed) in July may increase the key rate. This will further strengthen the dollar on the global foreign exchange market.

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