GBP: Initial support is seen near $1.3500 – BBH

Sterling briefly poked through $1.36 but stopped well shy of the last September's high near $1.3655 and initial support is seen near $1.3500, explains Marc Chandler, Global Head of Currency Strategy at BBH. 

Key Quotes

“The technical indicators appear stretched but not as much as the euro and Dollar Index.   A slew of UK data will be reported next week and Q4 growth seems largely on pace with Q3.  There is also widespread expectations of a cabinet reshuffle as early as next week.”

“Sterling may respond positively (vs. euro) on signs that the hardline camp is weaker.  There has been much talk of the strong foreign demand for UK Gilts, and next week's external account may be a useful reminder that a good part of inflows is simply the mirror image of the trade and current account deficits.”