EUR/GBP risks points to the upside – Danske Bank

Arne Rasmussen, Head of FI Research at Danske Bank, sees the European cross could edge higher in the next periods.

Key Quotes

“Reports of progress in Brexit negotiations in relation to a possible transition period after the two-year negotiation window expires in 2019 kept EUR/GBP from bouncing along with EUR/USD yesterday”.

“EUR/GBP still ended the day higher though and while further progress in negotiations could temporarily be GBP positive (note that Brexit negotiations continue today), we still see risks skewed on the upside for EUR/GBP, as UK politics, relative interest rates and growth are likely to remain EUR/GBP supportive in coming months”.

“We still see EUR/GBP within the 0.8650-0.90 range near term and, tactically, we continue to favour buying EUR/GBP on dips”.