British Pound: BoE hawkish shift could support gains against Euro – ING

ING’s Chris Turner writes that EUR/GBP has been pressured by French-related Euro risk but Sterling may gain further support if the Bank of England aligns with other central banks and hikes rates. Markets will watch centrist policymakers Andrew Bailey and Claire Lombardelli for any hint of backing a hike. ING sees strong support at 0.8455/0.8465, with potential tests of 0.8400 if a November hike looks likely.

Sterling eyes BoE centrist signals

"EUR/GBP has been dragged lower by developments in France and the extra risk premium being built into the euro. But sterling could start to receive some support from Bank of England policy should it look like the BoE is ready to fall in with other central banks and hike rates."

"After some hawkish speakers earlier in the day, the market will be watching centrist speakers Andrew Bailey and Claire Lombardelli."

"Any suggestion that they are ready to cross the Rubicon and vote for a hike could depress EUR/GBP further today."

"0.8455/65 looks like strong support after quite a sharp drop in EUR/GBP over the last couple of weeks. That should be tested if it looks like the BoE is ready to hike in November and there is outside risk to the 0.8400 area, while the French budgetary position remains unresolved."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)