EUR/GBP: Under pressure near term, rebound expected from 2Q onwards – ING
|EUR/GBP moved modestly higher on Tuesday. Economists at ING analyze the pair’s outlook.
Deterioration in economic conditions in the UK will ultimately warrant substantial BoE rate cuts
We remain of the view that a deterioration in economic conditions in the UK will ultimately warrant substantial BoE rate cuts (we estimate 100 bps), while markets are considerably overestimating the size of the ECB easing cycle.
However, data releases and BoE commentary in the near term may encourage some hawkish repricing at the front end of the GBP curve, which could keep pressure on EUR/GBP. We still target a rebound in the pair from 2Q onwards.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.