May seasonality is bearish for GBP/USD, economists at Société Générale report. 

Will GBP/USD dodge bearish May seasonal trend this year?

“The Pound wrapped up a decent month with gains vs all G10 currencies save for the SEK. The 1.6% gain for GBP/USD was in line with the seasonal fluctuations. The trend traditionally turns bearish in May, however. This c– SocGenould test the resilience of the rally to 1.25 from 1.18 in March.”

The optimism in business and consumer confidence surveys, and strong wage and inflation data, have fuelled speculation that the BoE may raise rates to a higher peak of 4.75%-5%. We forecast a 25 bps next week to 4.50%.”