TD Research discusses GBP outlook and stays sidelined and neutral in the near-term.
"The modest risk correction and dovish lean from the ECB helped to nudge the BDXY higher for a second week. Global risks are mostly binary now, as the market sits and waits for a growth recovery - or not," TD notes.
"The Fed looks happy to sit on the sidelines and hope that they can engineer an inflation overshoot. Low US real rates should reinforce the reach for yield but global growth will have to comply. Brexit headlines should intensify the two-way risks around GBP, though we think it holds the 1.28/1.31 range for now," TD adds.