MUFG Research discusses GBP outlook and adopts a core bullish bias vs the EUR over the coming months.
"The main trigger for pound outperformance at the start of this week has been the announcement from UK Prime Minister Boris Johnson yesterday that the government plans to proceed with the final stage of easing COVID restrictions on 19th July following a four week delay," MUFG nots.
"Allowing the UK economy to more fully re-open supports our bullish outlook for the pound. We expect EUR/GBP to fall into the low 0.8000’s as the UK economy continues to recover more robustly through the rest of this year, and speculation continues to build over BoE rate hikes a soon as next year. However, the bold approach from the UK government is not without risks," MUFG adds.