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Barclays Forecasting A Turn In Sterling

Barclays Forecasting A Turn In Sterling

The British Pound is predicted to come under pressure against the Euro and Dollar ahead over coming weeks and months, with a more sustained recovery only likely in the second half of 2022.

This is the expectation of Barclays, who have updated clients with their exchange rate forecasts for the upcoming year. The findings are largely bearish on Sterling but a key takeaway of the research is that the Dollar’s bull run that characterised much of 2021 will fade and allow some recovery in GBP/USD.

The main currency pairs start this morning showing little change compared to yesterday’s open. Confined to tight ranges over the past 24 hours with the euro continuing to trade near its recent lows. In level terms, the EUR/USD remains pinned down below the 1.13 mark. GBP/EUR is changing hands just above the 1.19 region whilst the GBP/USD operates in the upper half of 1.3350.

Datawise today, the Eurozone will be closely watched for the German Ifo survey (Nov) readings. A packed pre-Thanksgiving US schedule also features Core PCE inflation, personal income/spending, durable goods, new home sales (all Oct), jobless claims (Nov) as well as the second reading of Q3 GDP. The Fed will also be releasing its November meeting minutes.


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