May face gains towards 1.2950/1.30 – Scotiabank

The Pound Sterling (GBP) is a relatively better performer on the session, posting a 0.4% gain on the USD so far which has lifted Cable back above 1.29, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

Cable may see additional gains towards 1.2950/1.30

“UK Retail Sales data gained 0.5% in the July month, a bit below forecasts, but core sales rose 0.7% in the month, a little better than expected. Very weak June data were revised marginally higher.”

“The recent run of UK data has been mostly positive—jobs, GDP and now Retail—which is curbing market expectations for how much more the BoE can ease this year (swaps imply around 43bps of easing risk).”

“GBP gains have picked up again after spot broke out bullishly from yesterday’s consolidation range in the upper 1.28s. Fresh short-term highs for Cable through 1.29 target additional gains towards 1.2950/1.30.”