The British pound continues to trade with a fragile tone. ING economists expect the GBP/USD pair to test the 1.25 level.
EUR/GBP could move lower in the range of 0.83-0.84
“Most feel now that GBP/USD has yet to test 1.2500, while 1.2850 will now act as strong resistance if he achieves that maximum”.
“One of the key stories this year will be whether central banks will move forward even if growth slows.. That will clearly give a flat yield curve or invert yield curves, but could actually see currencies remain strong. Therefore, Until the Bank of England (BoE) waves the white flag on the rest of its tightening cycle, we think it may be too soon to write off sterling, particularly against the euro.“.
“Don’t be surprised if EUR/GBP sinks back into a range of 0.8300-0.8400“.
Source: Fx Street
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