EUR/GBP to edge slowly higher towards the 0.90 area on a 12-month view – Rabobank

Economists at Rabobank discuss GBP outlook.

GBP will stop reacting positively to rate rises over the medium-term

While economic data releases have the potential to spark volatility in GBP crosses, we expect EUR/GBP to remain mostly within a 0.85 to 0.86 range on a one-to-three month view, edging slowly higher towards the 0.90 area on a 12-month view. 

As the BoE raises rates further, economic risks also rise. This suggests an increased risk that GBP will stop reacting positively to rate rises over the medium-term.