Euro: Fiscal risks cap upside against British Pound – Rabobank
Rabobank's Senior FX Strategist Jane Foley discusses EUR/GBP in light of divergent fiscal and political risks in Europe and the United Kingdom (UK).
Rabobank's Senior FX Strategist Jane Foley outlines the EUR/GBP outlook, considering the different fiscal and political risks in Europe and the United Kingdom. She notes that France's financial and political challenges are more severe than those of the UK, which has led to a lower EUR/GBP forecast of around 0.85 over the next three months.
The bank recently revised its EUR/GBP predictions lower across the board, forecasting the pair to trade in a choppy range near current levels on a 1 to 3-month horizon. Foley suggests that the upcoming UK budget on October 28 could provide a breather for the British Pound, as it appears less vulnerable to a sell-off compared to the Euro.
She anticipates that volatility will persist in the EUR/GBP pair throughout the month, but there may be pullbacks offering relief to the Euro from current selling pressure.
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