The GBP is displaying strong cyclical momentum – which should continue through the summer, in the view of economists at HSBC.

Positive but cautious outlook

“The GBP has been enjoying both improved risk appetite and cyclical upswing.”

“We believe cyclical momentum should continue to support the GBP in the months ahead.”

“Yet, with weakening credit dynamics and the waning positive impact of disinflation, GBP/USD may not go far beyond the 1.30 level.”

See – GBP/USD: Looking for an eventual final leg higher to test 1.2668/1.2758 – Credit Suisse