GBP/USD has found decent support on dips over the past week but gains have been capped below 1.28. Economists at Scotiabank analyze the pair’s outlook.
Sterling still looks relatively ‘cheap’ in broad terms and the risk of an extended BoE policy tightening cycle remains alive. Sterling should remain well-supported on dips.
Regaining 1.2800+ would be a short-term positive for the Pound at least.
Support is 1.2705.
See: The Pound will come under depreciation pressure in the medium term – Commerzbank