FXStreet (Edinburgh) – According to strategists at TD Securities, expectations of a rate hike by the BoE could surely lend extra support to the sterling in the next months.
Key Quotes
“The MPC has turned the corner in being willing to talk about the nearing start to rate hikes”.
“This is a month or two earlier than we expected, but is overall consistent with our expectation for a February 2016 hike”.
“The wage data has continued to particularly strengthen and seems to be driving the MPCs comfort to talk hawkishly. But we still think a hike by November is difficult given CPI should still be below 1.0% y/y”.
“The BoE has turned increasingly hawkish in recent weeks as the UK economy has gathered momentum”.
“With rate hikes likely early next year, we think the GBP is likely to continue its recent outperformance”.
“The USD looks ready to resume its uptrend, complicating the view for cable, but we think GBP will outperform the EUR and commodity-linked currencies”.
(Market News Provided by FXstreet)