Bank predicts the pound will be worth the same as the euro by early next year
- Credit: PA
British holidaymakers should brace themselves for more Brexit pain when they change their pounds into euros, after Morgan Stanley forecast the currencies are on the way to parity.
Yesterday the pound was trading at 1.09 euro after collapsing from 1.31 euro the day before Britain voted to quit the European Union in June.
But the US investment banking giant believes the dilapidated British currency has further to fall and is pencilling in pound-euro parity in the first quarter of 2018, when £1.02 will buy just one euro.
It would signal the first time in its 18-year history the euro has reached parity with sterling.
Piling on the misery, Morgan Stanley said: “The UK economic outlook looks bleak, with stretched household balance sheets, Brexit negotiation uncertainty potentially weighing on business investment, and net exports growth staying subdued.”