According to Jane Foley, Head of FX Strategy at Rabobank, the Sterling could lose some traction in the 3-6 month horizon.
“Since the BoE turned clearly hawkish in September 2017, GBP has drawn support from expectations of higher interest rates. News in December of an EU/UK agreement on the legacy issues connected with Brexit and the subsequent confirmation of a deal regarding the post Brexit transition period have also supported sterling”.
“While a May rate hike from the BoE is largely priced-in, the pound may find further support if the MPC lean towards another rate hike in November. That said, we expect anxiety regarding the EU/UK trade talks to undermine the pound on a 3 to 6 mth view. On a 12 mth view we expect GBP to rise on an anticipated free trade deal”.
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.