DailyBubble News
DailyBubble News

0.84 Due To “Rate Differentials” Say Rabobank

The latest Euro to Pound Sterling forecast from Rabobank analysts predicts a decline in the pair due to differing views on Bank of England rate cuts. BoE Chief Economist Pill has cautioned against easing too early, while speculation on rate cuts continues to impact EUR/GBP. Recent UK CPI data showed mixed results, with a higher-than-expected headline rate. Rabobank expects EUR/GBP to decrease to 0.84 as a result of rate differentials. Despite recent GBP strength, its resilience is attributed to past weaknesses. Radical fiscal policy changes in the UK are unlikely due to public finances. The pound has been performing well compared to other G10 currencies, but it remains below its long-term averages against the EUR and USD. The forecast for EUR/GBP to reach 0.84 in the next six months is based on rate differentials, with little expected impact from the upcoming UK election. Given the strained state of UK public finances, major fiscal policy changes are unlikely.

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