Monson warns on sterling as 'Draghi Effect' takes hold

Sarasin & Partners' Guy Monson has warned sterling's recent show of strength against the euro could be about to end, as ECB intervention draws near and the UK's QE policy weighs on the pound.

Monson, managing partner of Sarasin and manager of a number of funds including its £144m Sarasin Global Equity Income fund, said sterling's rise in the last year against the single currency has left it looking susceptible to a reversal. With ECB President Mario Draghi doing a good job of placating nervous investors thus far, Monson said sterling's growing list of headwinds could lead to a sell-off versus the euro from here if Draghi continues to formulate a eurozone recovery plan. "Sterling now appears more vulnerable to the continued UK slowdown, further bond purchases under the late...