• Cable fading back from Monday's short squeeze

• GBP squeeze excerbated by Burham's spokesman pushing back on any fiscal rule flexibility

• However, this will not stop markets pricing in the risk of greater gilt issuance if Burnham becomes PM

• As such, elevated gilt yields may remain a drag on GBP if the focus is on fiscal sustainability concerns

• Despite GBP's squeeze higher. Bears will be encouraged by cable's struggle above the 200DMA (1.3426)

• Should keep a return to 1.33 in play. Meanwhile, EUR/GBP should stay underpinned
GBPUSD daily chart


Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))