18 May 2015
EUR/GBP could break below 0.70 in the near-term – BTMU
FXStreet (Edinburgh) - Currency Analyst Lee Hardman at BTMU sees the likeliness of the cross to breach the psychological 0.70 level in the near term.
Key Quotes
“The continued outperformance of the UK economy remains supportive for the pound although the BoE has created a higher hurdle for the market to bring forward first rate hike expectations following the release of the more dovish than expected Quarterly Inflation Report”.
“We continue to expect the pound to strengthen further against the euro. Downside risks to our EUR/GBP forecasts have increased in the near-term which may result in an earlier break below the 0.7000-level especially if the recent broad-based euro rebound proves unsustainable as we expect”.
“The ECB’s QE programme is supportive for the pound and helps to dampen downside risks to growth for the UK”.
“However, an unfavourable outcome for Greece which is not our central scenario would likely also be supportive for the pound but unfavourable for economic growth in the UK posing modest downside risks”.
Key Quotes
“The continued outperformance of the UK economy remains supportive for the pound although the BoE has created a higher hurdle for the market to bring forward first rate hike expectations following the release of the more dovish than expected Quarterly Inflation Report”.
“We continue to expect the pound to strengthen further against the euro. Downside risks to our EUR/GBP forecasts have increased in the near-term which may result in an earlier break below the 0.7000-level especially if the recent broad-based euro rebound proves unsustainable as we expect”.
“The ECB’s QE programme is supportive for the pound and helps to dampen downside risks to growth for the UK”.
“However, an unfavourable outcome for Greece which is not our central scenario would likely also be supportive for the pound but unfavourable for economic growth in the UK posing modest downside risks”.