GBP to extend weakness against EUR and JPY – TDS

Economists at TD Securities remain constructive on EUR/GBP and expect a re-entry to 0.90/0.92 in the weeks ahead.

GBP will become a laggard in broad terms

“The BoE appears to be joining the Fed and BoC in nearing a pause in the hiking cycle. This, we think, means that GBP will become a laggard in broad terms.”

“In crosses, we look for GBP to extend weakness against EUR and JPY.” 

“EUR/GBP remains rather constructive after a punch above 0.89. We expect a re-entry into a new higher trading range marked by 0.90/0.92.” 

“We remain medium-term bulls on the JPY as we believe that the BoJ is on borrowed time and will need to make more changes to YCC soon; 155 is near-term support, but we see extension risk to 150.”