Intraday losses in the GBP suggest the mid-week gains in cable have peaked. Economists at Scotiabank expect the GBP/USD pair to return toward the 1.20 area.

Key support seen at 1.2080 in the short run

“The energy crunch and cost-of-living crisis suggest significant economic headwinds lie ahead for the UK economy and that will restrain the GBP’s ability to advance against a softer USD.”

“The top of the range this week coincided with a test of key resistance at 1.2275 and failure here suggests cable risks heading back to the 1.20 zone.”

“We spot key support at 1.2080 in the short run.”