26 Jan 2016
EUR/GBP faces resistance ahead – Rabobank
FXStreet (Edinburgh) - Senior FX Strategist at Rabobank Jane Foley reviewed the potential upside in EUR/GBP.
Key Quotes
“At the start of December 2015, sentiment in sterling started to sour. By mid-January EUR/GBP was trading at its highest level since January 2015 as the market faced up to increasing downside risks to UK growth and the prospects that CPI inflation would take even longer to return to the Bank’s 2% target”.
“Adding to the headwinds facing the pound are political uncertainties surrounding the forthcoming referendum on EU membership. Political uncertainty from any source is currency negative meaning that GBP could be in for a volatile year. While GBP is vulnerable going forward, a step up in dovishness from the ECB should offer some resistance for EUR/GBP”.
Key Quotes
“At the start of December 2015, sentiment in sterling started to sour. By mid-January EUR/GBP was trading at its highest level since January 2015 as the market faced up to increasing downside risks to UK growth and the prospects that CPI inflation would take even longer to return to the Bank’s 2% target”.
“Adding to the headwinds facing the pound are political uncertainties surrounding the forthcoming referendum on EU membership. Political uncertainty from any source is currency negative meaning that GBP could be in for a volatile year. While GBP is vulnerable going forward, a step up in dovishness from the ECB should offer some resistance for EUR/GBP”.