Rokos Capital Management, the hedge fund firm founded by billionaire trader Chris Rokos, has warned that sterling is vulnerable to further falls in value, according to a report by the Financial Times.
And in a further gloomy prediction, the firm also believes that the UK’s recession could have a “serious” effect on British society.
The report cites a letter sent to investors in the $14.5 billion firm as saying that impact of Brexit, deglobalisation and the coronavirus pandemic had produced a bigger shock to UK trade than other developed countries.
The letter said: “The recession that is required to tame inflation in the UK is deeper than that needed elsewhere, with potentially serious societal implications. Sterling looks vulnerable.”
Macro manager Rokos was one of the firms to profit from turmoil in the the UK’s gilt markets in September following former UK chancellor Kasi Kwarteng’s announcement of huge unfunded tax cuts.
