Finger still in the air, Goldman forecasting GBP edition

You’re a currency analyst. You have models. Your models give you comfort and a safe place from where you can play The Forex. They give you stability and a lens through which the world appears manageable.
Then Brexit happens.
From Goldman’s FX team as t…

You're a currency analyst. You have models. Your models give you comfort and a safe place from where you can play The Forex. They give you stability and a lens through which the world appears manageable.

Then Brexit happens.

From Goldman's FX team as they try to work out a fair value for sterling:

Continue reading: Finger still in the air, Goldman forecasting GBP edition

Breakevens and the Great British Peso

While we’re waiting for everyone to flail through the ocean of FX crash causality, this is worth paying attention to….

5y5y forward UK inflation swap rate. Market inflation expectations in the process of being deanchored? pic.twitter.com/D5ZqiD29sW

— Toby Nangle (@toby_n) October 7, 2016

Continue reading: Breakevens and the Great British Peso

While we’re waiting for everyone to flail through the ocean of FX crash causality, this is worth paying attention to….

Continue reading: Breakevens and the Great British Peso

Finger still in air, GBP forecasting edition

Right, with the warning that we are back in The Forex and nothing is certain, this from HSBC is an unpleasant paragraph for those long the Great British Krona*:

In our view, GBP is the main part of the adjustment mechanism but the adjustment is not over yet. We still see GBP-USD at 1.25 by end of Q3 and 1.20 by year-end. However, we now see GBP weakness extending into 2017 and we now forecast GBP-USD at 1.10 by end-2017. This aligns with our economist’s view that the Bank of England will ease even further, cutting rates by 15bp in November and expanding QE in February next year.

Continue reading: Finger still in air, GBP forecasting edition

Right, with the warning that we are back in The Forex and nothing is certain, this from HSBC is an unpleasant paragraph for those long the Great British Krona*:

In our view, GBP is the main part of the adjustment mechanism but the adjustment is not over yet. We still see GBP-USD at 1.25 by end of Q3 and 1.20 by year-end. However, we now see GBP weakness extending into 2017 and we now forecast GBP-USD at 1.10 by end-2017. This aligns with our economist’s view that the Bank of England will ease even further, cutting rates by 15bp in November and expanding QE in February next year.

Continue reading: Finger still in air, GBP forecasting edition