What's Behind the British Pound's Flash Crash

The transcript discusses the liquidity issues in Sterling, highlighting a significant flash crash attributed to various factors, including computer-generated sell orders and market sentiment. The potential for pound-dollar parity is debated, with Brexit's impact on the currency being a key concern. Regulatory challenges in preventing such crashes are explored, noting the limitations faced by banks under current regulations. The Bank of England's response to Sterling's fall is examined, with a focus on inflation and economic competitiveness.

What was one of the speculated causes of the sterling flash crash?

• A sudden increase in interest rates

• Computer-generated sell orders

• A natural disaster

• A political announcement

What is the current range mentioned for the pound-dollar exchange rate?

• 1.18 to 1.26

• 1.50 to 1.60

• 1.10 to 1.15

• 1.30 to 1.40

Which currency experienced a similar flash crash as mentioned in the transcript?

• Japanese Yen

• Euro

• South African Rand

• Canadian Dollar

What role did banks play in the currency markets before the global financial crisis?

• They acted as shock absorbers

• They set the exchange rates

• They restricted market access

• They eliminated market volatility

What has been the Bank of England's focus regarding the impact of Brexit?

• The impact on international trade

• The inflationary impact of a falling currency

• The growth headwinds for the economy

• The political implications