We doubt the BoE has sufficient ammunition (yet) to push back against the nearly five 25 bps hikes expected before year-end. That suggests Sterling can stay supported for the time being.

Technically, GBP/USD does look as though it can advance to the 1.30 area – though the macro catalyst for further gains appears unclear.  Indeed, the UK press is really pushing the 'mortgage timebomb' story at present, but Sterling probably does not correct lower until we see some softer price data – which may take a few months to come through.