GBP: Solid labour market report to have shallow effect - ING

Petr Krpata, chief EMEA FX and IR strategist at ING, suggests that while UK May wage growth will likely reach the post-crisis high of 3.5%, this should not change the current market pricing of a partial interest rate cut over the course of the next 12 months.

Key Quotes

“Given Brexit uncertainty and generally deteriorating UK data- be it the forward looking PMIs or real indictors such as retail sales or the expected soft 2Q GDP. This suggests fairly limited and shallow upside to GBP from the expected solid labour market report today. EUR/GBP to remain around the 0.9000 level.”