GBP: Sterling Stirring Too Much? What’s Next? – CIBC

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The pound has risen quite a bit on hopes for a rate hike in November, but stalled after the big rise. What’s next? Here is the view from CIBC:

Here is their view, courtesy of eFXnews:

CIBC FX Strategy Research argues that while the expectations for rate increases in the UK have supported GBP recently, it’s unlikely for such a BoE-induced rally to be sustainable.

“…The fact that even normally fairly dovish members are talking of them suggests this time they could become reality. But the BoE will have to be very careful. Unlike other areas of Europe, growth hasn’t been accelerating this year. And the one upside surprise we got this week, in the form of retail sales, could be due for a correction given that real earnings growth is now back in negative territory.

So the upside in sterling linked to an initial BoE rate increase, if one is forthcoming, could be short-lived,” CIBC argues.

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Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.