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Brexit weighs on UK’s ‘problematic’ current account deficit: Maybank

Jude Chan Published on Mon, Jun 27, 2016 / 11:25 AM GMT+8

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SINGAPORE (June 27): Britain’s exit from the European Union (EU) while its current account is still large – at 5% of GDP – could mean more risks for the pound, according to Maybank Kim Eng.

“Ultimately, returns on capital in the UK need to be high enough to attract capital attract and fund the current account deficit,” says Maybank analyst Sadiq Currimbhoy in a Friday report.

“Some of this capital has also taken the form of human capital, which has contributed to the domestic UK economy,” he adds. But this is now fraught with uncertainty as Brexit rhetoric turned towards an anti-immigration drive.