Why central banks around the world are dropping euros for pounds
European Union stability and negative interest rates have reserve managers worried
A survey compiled earlier this year and published on Monday showed more than-two thirds of 80 central banks are cutting exposure to the euro in favor of the British pound, reports the Financial Times.
Respondents’ biggest fears were political instability in Europe, amid growing anti-EU sentiment, and the European Central Bank’s negative interest rate policy, which has eroded profits of private banks.
Around half of the survey’s respondents were from emerging market central banks.
71% of reserve managers polled said that Brexit had not negatively affected the pound’s attractiveness, while close to 80% said the election of Donald Trump had not changed their view of the dollar.