What is the forecast for GBP/USD?
Here is their view, courtesy of eFXdata:
MUFG Research maintains a structural bullish bias on GBP/USD but warns that the latest developments on COVID variant may pose downside risks.
“Broad-based US dollar weakness has seen cable trade above the 1.4000-level for the longest period since April 2018. The pound has shown little reaction to the UK government’s recent concern over the spread of the new Indian COVID variant in the UK. Prime Minister Boris Johnson has already warned that it could potentially delay the final phase of re-opening planned for 21st June,” MUFG notes.
“Our bullish outlook for the pound is based on the assumption that the UK economy will bounce back strongly, so we will need to monitor the latest COVID developments closely as they potentially pose downside risks,” MUFG adds.
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