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- Ongoing GBP challenges into year-end – CIBC
Ongoing GBP challenges into year-end – CIBC
The BoE is likely done raising rates – and the combination of weak activity and a softening labour market will weigh on the GBP in the near-term, economists at CIBC Capital Markets report.
The BoE is done but will leave the door ajar
Having held rates in September, it appears that the BoE is mindful of the lagged impact of the 515 bps of accumulated tightening thus far in the cycle. Indeed, we now assume that the BoE has likely concluded its policy tightening.
The UK rate spectrum remains a function of inflation expectations and growth assumptions.
The paring in terminal rate expectations, allied to ongoing data headwinds point towards ongoing GBP challenges into year-end.
GBP/USD – Q4 2023: 1.19 | Q1 2024: 1.21
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