In the opinion of HSBC economists, Both internal and external factors point to future sterling weakness.
Cyclical history unlikely to provide much support for GBP
As markets will slowly begin to see that the next move in UK rates will be down, not up, we think a change in rate expectations could drag the currency down.
The cyclical story is also unlikely to provide much support for the GBP, as short-term cyclical indicators such as PMIs have started to worsen again.
Finally, unless and until there is a rebound in risk appetite, supported by an improving global outlook, difficult domestic forces are likely to continue weighing on the GBP.
Source: Fx Street
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