BBH Flags Downside Risks for Pound as UK GDP Set to Contract

Brown Brothers Harriman (BBH) analyst Elias Haddad has pointed to increasing downside risks for the British Pound. The warning comes as UK GDP is expected to contract in the second quarter, while markets continue to price in additional rate hikes from the Bank of England (BoE) amid concerns over second-round inflation effects.

These twin pressures—weakening economic output and tighter monetary policy expectations—create a challenging backdrop for sterling. Haddad's assessment suggests that the pound may struggle to gain ground against the US dollar in the near term.