British Pound: Weekly outside reversal eyes 1.3650 against US Dollar – Scotiabank
Scotiabank analysts highlight that Bank of England Governor Bailey sees little evidence of second-round inflation effects and a more resilient UK economy, with markets still pricing a 25bp hike next month.
Scotiabank analysts have noted that Bank of England Governor Bailey sees limited evidence of second-round inflation impacts in the UK, suggesting the economy is more resilient than anticipated. The market is pricing in a 25 basis points rate hike early next month, with current GBP/USD trading within a bullish weekly outside range.
The analysts predict that the pound could retest the 1.3650-1.3675 level, with a key resistance point at 1.3435. Chancellor Healey plans to raise the corporation tax bank surcharge from 3% to 8% in the upcoming budget, aiming to bolster the UK's public finances.
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