Lamont confident the pound will strengthen ‘considerably’

÷ THE man who faced one of sterling’s biggest crises sees the currency recovering from Brexit.

Norman Lamont, the UK’s former Chancellor of the Exchequer when Britain tumbled out of Europe’s Exchange-Rate Mechanism 25 years ago, a day known as Black Wednesday, said sterling could appreciate “considerably” if the UK and EU reach agreement in Brexit talks.

The pound rallied this week to its highest level against the dollar since just after the Brexit vote, yet on a trade-weighted basis is still close to a record low as the complex divorce discussions between Britain and the EU cloud the outlook. Even so, the UK is still an attractive destination for foreign investment and the easing of uncertainty with a pact would boost the currency, said Lamont.

“I would not be surprised if after the negotiations are completed, and assuming they’re successful, sterling didn’t strengthen quite considerably. The current weakness of sterling is partly a phenomenon of euro strength.

“The main consequence of 1992 was to solidify British public opinion against the euro and to make it more skeptical about our EU membership,” said Lamont, now 75.