Sell Any GBP Rallies; Lean EUR Shorts – Citi

Slightly more data pads next week in Europe with some key release in the UK and the ECB minutes. Jobs, inflation and retail sales numbers in the UK will give some update on where the economy is over June/July. Still, it is just CPI which gives a full post Brexit sample and we don’t expect that real data (retail sales and jobs) will show much of a shock yet. In fact, the more headline jobs figures are for June.

With this in mind, GBP reactions to the data may not stick. Instead we suspect GBPUSD to remain heavy and for rallies to be sold.

ECB minutes seem unlikely to excite but color on Brexit discussions and/or scope to change asset purchases will be the highlight.

We lean short EUR. Finally, the ZEW and trade numbers out of Norway should be largely irrelevant for markets.

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