UK in a Changing Europe-Virtual Conference on the Economics of Brexit

Description

This research investigates how macroeconomic factors affect the trading value of GBP throughout different stages of Brexit. This research creates an equal-weighted, monthly-adjusted and non-hedged currency portfolio by using the Pound Sterling prices of all G10 currencies. The portfolio performance indicates the amount of Pound Sterling from hypothetical £1 investment to this portfolio, used as a proxy of the "trading value" of GBP. Associated to this Pound currency portfolio is a comprehensive universe of UK's macroeconomic indicators, which have been frequently tracked by both the financial industry and statistical authorities in the UK. Meanwhile, this study designs an experimental framework to select the best-fitted ARDL (Autoregressive Distributed Lag) model. This research observes a positive relationship between the unemployment rate and Pound Sterling appreciation during the post-Brexit period, which reflects how the Brexit-related immigration policy renewal affects human resource management in business. The statistics also reveal the importance of house purchasing and trading partnership with non-EU countries on maintaining the confidence of investors, which can retain the strength of the Pound against other currencies and during the post-Brexit period.

Period	22 Sept 2020
Held at	The UK in a changing Europe, United Kingdom
Degree of Recognition	International