FXS: Strong CPI and employment data expectations to support GBP
FXStreet (Delhi) – Research team at BNP Paribas, expects strong numbers from the release of August UK CPI data, due on Tuesday (15 September) and the July employment report, due on Wednesday (16 September). Both of them are likely to support the Pound if they turn out to be strong as expected.
Key Quotes
“Our economists expect both data releases to surprise to the upside, forecasting an above consensus 0.1% y/y rise in headline CPI and a fall in the unemployment rate back to the cycle lows at 5.5%.”
“With long GBP positions now having been substantially reduced according to our BNP Paribas positioning analysis framework and rates markets having delayed expectations for the first Bank of England (BoE) rate hike to August 2016, we think sterling will be more sensitive to any upside data surprises than downside.”
“We remain long GBPAUD from 2.14 targeting a move to 2.25 and exposed to EURGBP downside via a put fly expiring next January.”
