British Pound Futures Volatility Forecast (28/11/2010)

The volatility plot shows a very uncertain situation since the drop, that we managed to forecast the last week, happened without causing any significant development in the TGARCH calculation.

The volatility is around 0.6% (9.6% annualised) and it should keep rising during the next week accompanying the downtrend. The drop in the market could easily continue since the dollar keep appreciating and the concerns about Ireland in addition to the UK commitment to Irish debt could scary investors away.

Furthermore, UK authorities seem to welcome a depreciation of the British pound which would automatically boost the export and bring some fresh air to the British GDP.

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