Has anyone heard how long this might last? I know I checked XE this morning and they were reporting just under the $2 mark.
I'm no expert but this is driven by recent economic news. Good gauges of UK & US economic news are government set interest rates (US Federal Reserve & Bank of England). Here's my thoughts:
(1) Inflation is high in the UK so Bank of England is extremely likely to raise interest rates in May (good news for people with savings, bad news for people with mortgages). Recent high inflation is driven by housing costs and energy costs.
(2) Housing market downturn in US is likely to keep interest rates steady for at least the next few months as the government doesn't want to hurt homeowners further with interest rate increases. Defaults on mortgages are already too high.
(3) Because interest rates are on the way up in UK and steady in US, people want to put their savings in the UK as they will get more interest for their money, causing the pound to be more popular than the dollar and thus pound becomes more valuable.
I don't think this is likely to change in the next few months. It may not stay above 2 but wont be far off. Again, I'M NO EXPERT!!!!
In fact, if someone out there is more knowledgeable on this (not very difficult) I'd love to hear your thoughts.
