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Great British Peso


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I am a UK investor so while I have cash to put to work in the coming months if stock markets continue to slide a lot of the benefits are offset byhaving a lot less purchasing power as the £ has fallen from a post Brexit high of around $1.40/£ to a current level approaching $1.20/£. And Bank of England looks like it will be far less aggressive than the Fed in terms of rate hikes and seems far more likely to fall into a recession given the greater exposure to the Ukraine war and potential vulnerability re the housing market with most mortgages variable or on short term fixes so quite vulnerable to even modest interest rate rikes and with far more modest fiscal stimulus post pandemic we didn't rebound as strongly as the US. So seems like there is further downside vulnerability.

 

I am fairly confident that markets are heading quite a lot lower but if the pound tumbles down to close to parity with the dollar that will offset most of the benefits of having cash available to deploy at a lower level.

 

What are peoples' thoughts re the outlook for the GBP and what are some good ways to hedge my exposure? I was thinking possibly buying some short term US treasuries as any losses will be modest as interest rates rise and might even be offset by FX gains. 

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