After UK PM May set the third-week of January for the Brexit vote, the topic took a step back with the Fed now in focus. But the pound is still on the move.
Here is their view, courtesy of eFXdata:
Danke Research discusses EUR/GBP outlook and maintains a cautious bias in the near term and a bearish view in the long term.
“In our main scenario, we still expect a ‘decent’ Brexit and maintain our long-held view that EUR/GBP will break lower if/when the deal is passed by parliament.
We target 0.83 in 6-12M. However, the UK House of Commons remains divided on Brexit and while all options are still on the table in relation to the outcome of negotiations, uncertainty is expected to remain high in coming months as clarifications about Brexit drag on,” Danske notes.
“Hence, we expect EUR/GBP to remain volatile and within its recent (wide) trading range near term, targeting 0.88 in 1M and 0.87 in 3M,” Danske adds.
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