GBP/USD to struggle to break above 1.40 as dollar remains supported – ING

GBP/USD fails to benefit from the dollar’s pullback, as it struggles to extend its bounce from weekly lows. Economists at ING expect the cable to stay under the 1.40 level as the dollar enjoys bullish momentum.

See – EUR/GBP: Failure at 0.8471/65 to target the 0.8314/0.8239 zone – Commerzbank

Sterling stays supported on good economic sentiment

“The week ahead sees the release of the UK growth numbers for 2Q. Our economist expects to see a strong 5.0% QoQ read. Despite the high probability that the rebound in activity has paused in the summer months, the release should fuel expectations that the British economy will be back to pre-pandemic levels by year-end.” 

“After the Bank of England likely sounded less alarmed than feared about the Delta variant spread as it inched closer to tapering and the UK government that has continued to ease travel rules, the underlying narrative for GBP appears to be by and large positive.” 

“EUR/GBP could extend its downward trend after breaking below 0.8500, but cable may struggle to break above 1.4000 if the USD remains supported.”