Citi discusses GBP outlook and maintains a structural bullish bias in the medium-term.
"EU member states are due to finalize their negotiating priorities for a future trade deal with Britain. It will say that a trade deal should be based on EU rules in some areas as "a reference point". Meanwhile, UK ministers will also meet to discuss the government's opening stance for negotiations. The final agreement is due to be published online and presented in Parliament on Thursday. Chatter here could be a source of short term volatility for GBP," Citi notes.
"Bigger picture, we maintain our structurally bullish view on GBP as 1) political risks recede and economic recovery carries on 2) long term investors are still structurally underweight GBP and UK assets," Citi adds.