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Arne Rasmussen, Head of FI Research at Danske Bank, gives his views on the BoE and the European cross for the next months.

Key Quotes

EUR/GBP dropped below 0.8750 on t he hawkish signals from the Bank of England (BoE) yesterday”.

“We stick to our call for one hike in H2 18 and one in 2019 with the next hike likely in August”.

“Near term, a break below 0.8650 would, in our view, require a more pronounced repricing of the BoE’s future rate path, which we do not expect. Hence, we expect EUR/GBP to continue to trade within a range of 0.8650-0.8850 in the coming months”.