Danske Research discusses EUR/GBP outlook in light of today's BoE's May policy decision.
"We stick to our call with one hike in H2 18 and one in 2019 with the next hike likely in August. That said, the probability of August has declined slightly , as we only get three months more data in August, which may not be enough for the majority of the BoE members.
With an August rate hike still in sight in our view, we see relative interest rates as neutral for EUR/GBP for now, but expect the GBP to eventually gain support from the rate channel .
We target 0.88 in 1M and 0.8650 in 3M," Danske argues.