Analysts at Danske Bank offer their outlook on the EUR/GBP cross on the probable scenarios on the outcomes of the UK PM May’s leadership challenge.
Key Quotes:
“Probability UK PM May remains as a leader and that parliament votes yes to her Brexit deal “has declined substantially”
See EUR/GBP to fall into a 0.865-0.88 range if May remains in charge.
EUR/GBP to remain volatile ahead of parliament’s Brexit vote.
A “decent Brexit” looks less likely, but EUR/GBP to 0.83 in three months if so.
The probability of a no-deal scenario has increased “¦ EUR/GBP could test 1.00.
If May resigns or loses a vote of confidence –> EUR/GBP to 0.92-0.95 range.
In case of a second Brexit referendum, EUR/GBP to be seen between 0.82-0.86.
A Remain vote to drag EUR/GBP below 0.80.”
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