GBP oversold, but data unlikely to offer much help this week - BNPP

FXStreet (Delhi) – Research Team at BNP Paribas, suggests that the UK data takes prominence in the data calendar this week, which comes against a backdrop of the GBP’s poor performance at the start of the year and GBP positioning reaching its largest short since 2008 with a score of -34 (out of +/-50).

Key Quotes

“Our economists’ forecasts don’t imply a significant data boost for the sterling however, with headline inflation on Tuesday expected to remain at just 0.1% y/y, unemployment rate steady at 5.2% on Wednesday and retail sales falling by 0.5% on Thursday.

We think EURGBP is at overbought levels and long GBPCHF remains one of our key trade ideas for 2016 but we are wary of initiating new GBP trade recommendations until global sentiment improves.”