• Technically, the sterling has steadily appreciated but the fundamentals are stretched
• Rate expectations have played a critical role in the pound's rally, but the market is over-reaching
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The British pound has proven one of best performing currencies over the past six months, but the strong run is flagging with the currency exposed at exceptional highs. A clear divergence in yield forecasts between the market and the Bank of England (BoE) has fed the pound's advance in the absence of other tangible support. A naturally precarious situation, bulls may find themselves increasingly antsy ahead of important data, the rate decision and the Quarterly Inflation report's forward guidance. We discuss this currency, its fundamentals and the trade scenarios in today's Forex Strategy Video.
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