Pound Sterling (GBP) is entering Monday’s NA session flat against the US Dollar (USD), a relative underperformer in an environment of modest risk appetite and mild USD weakness, Scotiabank’s Chief FX Strategists Shaun Osborne and Eric Theoret note.
CPI is on Wednesday and BoE is on Thursday
“Domestic risk is elevated this week as markets await Wednesday’s CPI release, coming just ahead of Thursday’s BoE where policymakers are expected to deliver a widely anticipated hold. Recent data disappointments have delivered an adjustment in expectations for the BoE, building in slightly more easing into the end of the year with markets now pricing nearly two 25bpt cuts.”
“GBP/USD remains well supported as it continues to push to fresh multi-year highs. The RSI is bullish but well short of overbought levels, and there appear to be no major resistance levels ahead of 1.3750. We look to near-term support around 1.3520 and near-term resistance in the lower 1.36s.”