EUR/GBP to target 0.8630 if the ECB raises rates – SocGen

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Cable consolidates after a 0.5% bounce on Wednesday. Economists at Société Générale analyze GBP outlook.

Expectations for the BoE meeting declined to around 18 bps after the 0.5% contraction in July GDP

We note that expectations for the BoE meeting next week declined to around 18 bps after the 0.5% contraction in July GDP rekindled concerns of recession. Gilts rallied sharply and spreads have come in vs Bunds and Treasuries after two days of outright disappointing stats. 

GBP/USD bounced back after trading down to the 200-DMA at 1.2430.

EUR/GBP is likely to remain volatile today with investors potentially targeting Wednesday’s high of 0.8630 if the ECB raises rates.

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• Source: https://www.fxstreet.com/news/eur-gbp-to-target-08630-if-the-ecb-raises-rates-socgen-202309140657