The British Pound has stabilized after the blow from the BOE and the previous plunges. The next moves depend on the jobs report. What’s next?
Here is their view, courtesy of eFXdata:
BTMU Research discusses GBP outlook and flags room for upside risk on the back of this week’s UK labor market data (Tues).
“The monetary policy meeting when the BoE disregarded the slowdown in Q1 as a blip is only just behind us and the first test of that optimism comes this week with the release of key labor market data.
There is no reason not to believe that wage pressures will continue to build. More timely data from Markit for the Recruitment and Employment Confederation, released last week, revealed another drop in permanent staff availability and an increase in the permanent staff salaries index. The report stated there was continued evidence of a tightening of labor markets country-wide.
We expect the pound to recover recent losses as the markets price in an August rate hike by the BoE,” BTMU argues.
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