7 Aug 2013
Flash: GBP/USD headed for 1.5550? – BMO Capital Markets
FXstreet.com (New York) - Greg Anderson, Global Head of FX Strategy at BMO Capital Markets, grapples possible scenarios for a GBP/USD uptick tomorrow on the eve of the BoE.
Key quotes
“Absent other factors left in place by the BoE and designed to offset the likely follow-through from the latest macro economic data, either curve flattening via the front-end or curve steepening via the long-end (or some combination of the two) would tend to boost the GBP tomorrow morning.”
However, “we think the BoE will resist anything more than a very modest degree of upside in rates [and therefore the GBP. We would look for opportunities to sell into GBP/USD rallies between 1.5450 and 1.5550.”
Key quotes
“Absent other factors left in place by the BoE and designed to offset the likely follow-through from the latest macro economic data, either curve flattening via the front-end or curve steepening via the long-end (or some combination of the two) would tend to boost the GBP tomorrow morning.”
However, “we think the BoE will resist anything more than a very modest degree of upside in rates [and therefore the GBP. We would look for opportunities to sell into GBP/USD rallies between 1.5450 and 1.5550.”