NG Research discusses the outlook for EUR/USD, and GBP/USD, and thinks that the 2 pairs will likely consolidate their recent gains in the very near-term, before resuming their medium-term strength through 2018.
"While the looming spectre of next week’s ECB meeting may keep EUR upside in check, we note that this weekend also sees a key moment for German politics; the Social Democratic Party will vote on whether to begin formal coalition talks with Chancellor Merkel.
The event risk may see EUR/$ stabilise in the 1.2200/50 region today – notwithstanding any (shutdown-related) further $ weakness," ING argues.
"We do think there is more upside for GBP yet to come in 2018 – but for now, we will require a positive GBP-related catalyst to take us over the 1.40 line. Here we continue to cite two non-mutually exclusive potential sources: (1) positive UK data surprises and (2) actual Brexit progress in the form of an agreed transition deal.
We look for GBP/USD to consolidate within the 1.3850-1.3900 area – with outside risks of 1.40 today," ING adds.
Source: ING Global Markets ResearchOriginal Article
