Even with Brexit, central bankers around the world seem to think the pound is a better long term bet than the euro. The main reason: speeding political uncertainty in Europe—and uncertainty that is caused in large part by the problems that the euro has caused. The Financial Times:
According to a survey published Monday of reserve managers at 80 central banks, who together are responsible for investments worth almost €6trn, the stability of the monetary union is their greatest fear for 2017. The results — compiled by trade publication Central Banking Publications and the bank HSBC earlier this year — show some respondents have cut their entire exposure to the euro, while others have reduced their holdings of investments denominated in euros to the bare minimum.
More than two-thirds of the 80 central banks had changed their portfolio allocation, while roughly that same amount had changed the duration of their investments. Developing and emerging-market central banks, some of which are among the world’s biggest reserves holders, were more likely than those from advanced economies to have shifted out of the euro. The UK’s decision to quit the EU has not affected the popularity of sterling as an investment currency so far, with 71 per cent of respondents saying the attractiveness of the pound was undimmed in the longer term.
This is not what success looks like.