Pound sharply lower as uncertanty post Brexit weighs

GBP/USD has opened sharply lower in Asia, currently trading at session lows of 1.3420 from 1.37 NY close, amid huge uncertainty on what's next for the UK after voting to leave the EU in Friday's referendum.

GBP to fall another 10%?

Kit Juckes, Head of FX Strategy at Societe Generale, provides his view: " Uncertainty is bad for UK growth and won't help Europe either. That wouldn't matter if the global economy were ticking along nicely but it isn't. We expect the pound to fall another 10% over time, and the euro may fall by about half that much. Soggy growth in developed economies won't fuel dramatic FX moves and volatility may be lower going forward, but it would be broadly negative for EM and commodity exporters."

GBP/USD oulook

Technically, Valeria Bednarik, Chief Analyst at FXStreet, notes: "After the dust settled, the GBP/USD pair found a comfort zone within the 1.36/1.37 region, ending the day in the lower end of the range.  A strong bearish momentum is present in the daily chart, although with the wide intraday swing, indicators remain distorted. Nevertheless, Pound's decline is far from over, and will likely accelerate below 1.3500, September 2009 low and a key psychological level. In the 4 hours chart, technical indicators have been unable to correct much, standing horizontal within oversold territory, also in line with further declines."