14 Jan 2016
EUR/GBP forecast unchanged after BoE - Danske Bank
FXStreet (Córdoba) - Analysts from Danske Bank, kept their forecast for EUR/GBP (0.73 in three months, 0.71 in six) after the release of the statement and the minutes of the Monetary Policy Committee of the Bank of England.
Key Quotes:
“The next meeting is due to take place only three weeks from now. At this meeting, we expect focus to be on the updated Inflation Report.”
“We think the Bank of England (BoE) will increase the Bank Rate in Q2 16, probably in May, but recognise that it sounds less and less ‘Fed light’.”
“We have kept our FX forecasts unchanged. We target EUR/GBP 0.73 in 3M, 0.71 in 6M and 0.75 in 12M. In the short term, we expect GBP to remain under pressure in a negative risk environment. However, GBP is significantly oversold, according to our short-term financial models, and we still look for a rebound in the coming three to six months, driven by a repricing of the BoE, as we expect the UK economy to continue to grow above trend in 2016.”
Key Quotes:
“The next meeting is due to take place only three weeks from now. At this meeting, we expect focus to be on the updated Inflation Report.”
“We think the Bank of England (BoE) will increase the Bank Rate in Q2 16, probably in May, but recognise that it sounds less and less ‘Fed light’.”
“We have kept our FX forecasts unchanged. We target EUR/GBP 0.73 in 3M, 0.71 in 6M and 0.75 in 12M. In the short term, we expect GBP to remain under pressure in a negative risk environment. However, GBP is significantly oversold, according to our short-term financial models, and we still look for a rebound in the coming three to six months, driven by a repricing of the BoE, as we expect the UK economy to continue to grow above trend in 2016.”