GBP/USD: Political risk underpinning sterling weakness - CIBC
|Analysts at CIBC, see the Pound rebounding over the next months on the back that some kind of agreement between the UK and the EU will be reached. They forecast GBP/USD at 1.33 in Q3 and at 1.41 in Q1 2020.
Key Quotes:
“In spite of continued political uncertainty, the UK economy remains fairly solid, as the BoE has upgraded its GDP forecasts. Barring the possibility of a hard Brexit, BoE Governor Carney has warned that rates in the UK should be higher than what the market has currently priced in, but for now, the market is currently preoccupied with political risk rather than fundamentals.”
“GBP has come off the 1.32 mark over the past few weeks, and there are signs that levels are a bit oversold. Handicapping Brexit is an impossible task, but our current assumption is that an accord with the EU will somehow be reached which supports an upward profile in GBP.”
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.