10 Apr 2014
GBP taking a breather? - Scotiabank
FXStreet (Guatemala) - Camilla Sutton, CFA, CMT, Chief FX Strategist at Scotiabank explained that after yesterday’s 1% rally, GBP is relatively flat.
Key Quotes:
"After yesterday’s 1% rally, GBP is flat. News flow has been quiet with Niesr reporting yesterday a 0.9% GDP estimate with evidence of broad based growth and today’s trade deficit slightly narrower than expectations at ‐£2.1bn."
"Tomorrow’s BoE meeting is likely to prove a non‐event with interest rates on hold at 0.5% and no change to the £375bn asset purchase program. However, next week’s CPI and employment releases will be important for FX traders."
"With an improving fundamental backdrop (note that the IMF made the largest change to the U.K.’s GDP forecast and a central bank that is likely to shift into its rate cycle ahead of the other G4, the outlook for EUR/GBP is negative. We hold a year‐end EURGBP target of 0.79."
"GBP/USD short‐term technicals: bullish technical studies warn of upside risk, as GBP flirts with a break above its multiyear high of 1.6823; accordingly there is resistance at this level, with support at the March 31st high of 1.6684."
Key Quotes:
"After yesterday’s 1% rally, GBP is flat. News flow has been quiet with Niesr reporting yesterday a 0.9% GDP estimate with evidence of broad based growth and today’s trade deficit slightly narrower than expectations at ‐£2.1bn."
"Tomorrow’s BoE meeting is likely to prove a non‐event with interest rates on hold at 0.5% and no change to the £375bn asset purchase program. However, next week’s CPI and employment releases will be important for FX traders."
"With an improving fundamental backdrop (note that the IMF made the largest change to the U.K.’s GDP forecast and a central bank that is likely to shift into its rate cycle ahead of the other G4, the outlook for EUR/GBP is negative. We hold a year‐end EURGBP target of 0.79."
"GBP/USD short‐term technicals: bullish technical studies warn of upside risk, as GBP flirts with a break above its multiyear high of 1.6823; accordingly there is resistance at this level, with support at the March 31st high of 1.6684."