Sterling to stay under pressure – CIBC

GBP/USD expected to trade at 1.27 in Q3 and 1.32 by 1H 2018

Bank of England
Bank of England: Jeremy Stretch doesn't foresee early action from the central bank, despite recent spike in inflation numbers

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Significant headwinds await sterling as the UK enters Brexit negotiations with the European Union on its future outside the bloc, according to Jeremy Stretch, head of G10 FX strategy at CIBC.

“We are very mindful the risks to sterling are still generally to the downside. There is a big question mark regarding the ability of the UK consumer sector to maintain the rate of spending in the context of falling real wages,” he says.

“Against the US dollar, the analysis