A client note via Nomura warns both EUR/USD and GBP/USD are vulnerable heading into the summit in Japan.
(ps. Note is from yesterday but still pertinent given GBP moves)
Recommend a short GBP position
- potential positives for the pound of a more hawkish BOE have faded away
- also, Fed cut pricing likely peaked, 25bps cut in July may make more sense than 50bp
- We therefore enter short GBP/USD looking for 1.25
- Also like long EUR/GBp
