The GBP is recording a slight gain on the day, bouncing off the low-1.31s. Bank of England (BoE) rates pricing are still too optimistic, which should drag cable down to the 1.30 level, according to economists at Scotiabank.

Broader trends since last summer suggest weakness ahead

“We think markets could do with a decent amount of repricing of BoE hikes, as they still foresee the bank rate reaching 2% this year, which should weigh on the GBP towards a test of 1.30 soon.”

“Broader trends since last summer would suggest weakness ahead in the GBP but near-term price action remains restrained, providing little sense of direction.”

“Support is 1.3090/00 followed by ~1.3080 and 1.3050/60.” 

“Resistance is ~1.3150 followed by 1.3180.”