GBP has fallen as much as EUR in recent weeks as weaker than expected UK inflation, a walking back of rate hike expectations over the last month, and some increase in negative political and Brexit news have combined to weaken the GBP, explains Greg Gibbs, Analyst at Amplifying Global FX Capital.
Key Quotes
“Employment data was strong, and retail sales were stronger in April. Travails in Italy and Spain should not undermine the GBP. Arguably it even makes Brexit seem not such a bad idea after all.”
“The market seems to be looking at the latest Brexit dealings with a glass half empty attitude. Progress has been made since last year, and PM May is attempting to move the negotiations forward. Negotiations are always going to look difficult. PM May is attempting to thread the needle, with everyone shouting at her and half the pavilion baying for her to fail.”
“The GBP/USD chart does not look attractive, and GBP/EUR is in a range.”
“There is no doubt a wide risk band around GBP at the moment, so I haven’t acted on this thought-bubble. But AUD/GBP is at levels that might look OK to sell.”
Share
