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Analysts at Scotiabank explained that GBP was extending its recent consolidation for a fourth consecutive session and entering Wednesday’s NA session within the mid/lower-1.31 congestion area.  

Key Quotes:

“BoE rate expectations remain firm into Thursday’s anticipated rate hike and yield spreads are offering support.”

“Brexit risk returns later this week as PM May is set to meet with French President Macron on Friday, ahead of U.K.-EU negotiations that are set to resume in mid-August.”

“Risk reversals remain divergent with a clear break at the 6-month horizon.”