GBP/USD seen in a 1.18-1.28 range – Westpac

Tim Riddell, Macro Strategist at Westpac, expects Cable to navigate within a 1.18-1.28 range in the next months.

Key Quotes

“The political hot potato of Brexit should drift to the background as the Article 50 Bill progresses through Parliament”.

“Attention will turn to confidence, prices and the impact on consumer activity. Markets will therefore become even more survey and data dependent as they question whether the BoE should alter its accommodative stance”.

“Economists and market commentators continue to warn about the negative impact on discretionary spending and investment intensions from Brexit as it becomes a reality. However, these negatives will need to become more apparent to alter the current support for GBP from stronger activity data”.

“GBP/USD is still perceived to be range bound (broadly 1.18-1.28). GBP may well test the upper bounds of this range before Brexit and USD upside pressures return”.