GBP/USD is trading close to weekly lows below 1.1200. Economists at ING believe that the pair could be back at 1.05 by year-end. 

EUR/GBP may struggle to break much lower than 0.8600

“Our view that: a) UK politicians will struggle to quickly reclaim all of the lost fiscal credibility and b) US real interest rates look set to push even higher this year meaning that GBP/USD will likely struggle to break above the 1.15 area over coming weeks.”

“Into year-end, we favour broader dollar strength as US real rates push to 2.00%, meaning that GBP/USD could be back at 1.05.”

“0.8600 may well prove the lower end of the EUR/GBP trading range over coming weeks and maybe months too any policy misstep could easily push the pair back to 0.90.”