Brexit: GBP/USD expected to be vulnerable until more clarity emerges - Rabobank
UK PM Johnson and EU Chief negotiator Barnier have been laying out their stalls ahead of the forthcoming UK/EU future relationship talks and the signals suggest that those talks could be testy. That's why analysts at Rabobank see risks of GBP/USD trading below the 1.30 level on a 1 and 3-month view as the talks progress.
"The move lower was no doubt exacerbated by last week’s surge which followed the BoE’s January 30 decision to leave rates on hold. Month-end flows have probably also played a part in the volatility."
"It is clear that for thousands of business across the UK and Europe, there is a lot riding on the outcome of the UK/EU future arrangement talks."
"Until more clarity emerges we expect GBP to be vulnerable."