GBP: Improving appetite – Danske Bank

Piet P. H. Christiansen, senior analyst at Danske Bank, explains that the GBP outperformed in the G10 space yesterday supported by a technical break above 1.30 in GBP/USD.

Key Quotes

“While uncertainty related to Brexit remains high, the risk of a ‘no deal’ Brexit appears to be fading, which has improved appetite for GBP.”

“We reckon that the past week’s rally in GBP is fair given that the ‘post Brexit’ outcome distribution for EUR/GBP looks increasingly skewed towards the downside.”

“Momentum is strong and with risks skewed towards the downside for EUR at the ECB meeting today, EUR/GBP could still test lower towards 0.86 in the coming days.”