A bullish view of GBP it has been among Credit Suisse’s most consistent rankings of 2023 so far. It is likely to continue to rise.
The EUR/GBP target is 0.8450
Looking ahead, the main questions are: 1) can core inflation in the UK fall rapidly given the tightness of the UK labor market? and 2) is the UK property market so fragile as to make it impossible for the Bank of England to raise rates as much as expected and/or keep them at a high level for any significant period of time?
In our view, if the ECB is concerned about the risks of spiraling wage prices in the Eurozone, the much more dire situation facing the Bank of England in the UK should be defined as a true emergency excluding a excessive concern about the health of the UK property market.
Although it is clear that the GBP has already appreciated a lot in 2023, we see room for further gains as EUR/GBP has room to reach at least 0.8450, while GBP/USD may also test 1.3000.
The main risk to our view is a sudden freeze/collapse in UK asset markets.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
