Societe Generale FX Strategy notes that the big near-term test for GBP comes with tomorrow’s retail sales data.
In that regard, SocGen argues that GBP could come under pressure if higher inflation meets softer wage growth and triggers slower consumer spending at the same time as political uncertainty increases.
This is specially true, according to SocGen, given GBP current valuation and positioning.
In line with this view, SocGen recommends being long EUR/GBP.
Source: Societe Generale Cross Asset ResearchOriginal Article
