0.84 Due To “Rate Differentials” Say Rabobank

2 Min Read


Euro to Pound Sterling Forecast

The Euro to Pound Sterling forecast by analysts at Rabobank suggests the pair will decline from current levels, citing diverging views on BoE rate cuts.

BoE Chief Economist Pill warns of risks in easing too early, while EUR/GBP remains sensitive to rate cut speculation.

Recent UK CPI data was mixed, with a higher-than-expected headline rate.

Rabobank anticipates EUR/GBP to edge lower to 0.84 due to rate differentials.

Despite GBP’s recent performance, its resilience reflects past weakness. Radical fiscal policy changes seem unlikely due to UK public finances.

Key Quotes:

“In the year to date, the pound is the second best performing G10 currency after the USD.”

“Last year the GBP was also the second best performing G10 currency, after the CHF.”

“Despite this, the pound remains below its long-term averages against both the EUR and the USD.”

foreign exchange rates

“We expect that EUR/GBP can edge lower to the 0.84 level on a 6-month view largely on the back of rate differentials.”

“This assumes little reaction to the UK election which is expected late in the year.”

“In view of the strained position of UK public finances, there would appear to be little room for radical changes to fiscal policy.”



Source link

Share This Article
Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *