Q4 GBP Fundamental Teaser

GBP/USD Analysis and Talking Points

Throughout the final quarter of 2019, UK politics will continue to outweigh the economics when it comes to providing volatility and direction for the Pound. Given the current parliamentary arithmetic (government lacks a majority) and impasse our base case scenario is for another extension to Article 50, which in turn could pave the way for a general election. In the run up, to the October 31st deadline, most notably the EU Summit (Oct 17-18), uncertainty will remain high over the potential Brexit outcome, thus not only dragging the UK economy lower but also the Pound.