GBP Surges Against USD on Improving Sentiment and Strong UK Data

Scotiabank strategists Shaun Osborne and Eric Theoret point out that the British Pound (GBP) has been gaining against the US Dollar (USD), outperforming its G10 peers in mixed trade. This improvement in sentiment is attributed to a recent data release from the UK, which included Q2 Gross Domestic Product (GDP) and production figures.

The short-term technicals of the GBP are looking bullish, with the Relative Strength Index (RSI) at fresh highs. Osborne and Theoret expect the next upside target to be in the mid-1.35s, possibly reaching as high as the mid-1.36s. Support is expected near 1.3400, within a near-term range of 1.3480-1.3580.