Does Spread Matter Anymore in FX? UK – US 2-yr Spread vs. GBP/USD

It used to be that spread mattered in the FX world. Maybe it will again someday. Note the big divergence between the direction of the UK-US 2-year interest rate spread and the currency—GBP/USD. Though still in negative territory relative to US rates, the UK relative yield has been on a tear higher. Hmmm….

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