Credit Agricole maintains a tactical bullish on GBP, expressing that via holding a long GBP/CHF position in its recommendation portfolio targeting a move towards 1.22.
"We believe that the UK government will agree to further talks and continue to expect that the two sides will ultimately agree on a ‘bare-bones’ trade deal before the hard deadline in late November. As has been the case in the past, the GBP could regain its composure if the officials kick the Brexit can down the road. We further think that the GBP may continue to enjoy its Brexit reprieve even if the upcoming UK data – CPI and retail sales for September as well as the PMIs for October – disappoints this week," CACIB notes.
"In addition, we believe that the diminishing prospect of negative policy rates may continue to prop up the GBP ahead of the 5 November BoE meeting. We remain long GBP/CHF in our strategy portfolio," CACIB adds.