GBP to target 1.30 near-term - BNPP

Research Team at BNP Paribas, suggests that regardless of how the broader risk environment evolves, they expect the GBP to remain under pressure this summer as markets question the capacity of the UK to attract investment flow sufficient to fund a large current account deficit.

Key Quotes

“Overnight, S&P cut the UK’s last remaining AAA credit rating and Fitch announced downgrades of the UK to AA from AA+. Today, BOE will hold its third and final special repo operation to provide liquidity following the referendum and our economics team continues to expect further easing measures to be announced at the August MPC or earlier in possible inter-meeting move. We expect GBPUSD to reach 1.30 in the near-term.”