Sell EUR/GBP at 0.8695 – Westpac

Analysts at Westpac are recommending to sell EUR/GBP cross at 0.8695 for the target price of 0.8375, while maintaining a stop loss of 0.8800.

Key Quotes

“Rationale:

• UK election should relieve sudden no deal Brexit concerns and raise potential of breaking the Brexit impasse
• Parties are likely to adopt post election expansionary mandates to allow for investment, spending and growth
• The election will be an effective poll on current negotiated deal against remaining and/or second referendum
• Eurozone is likely to receive further weak data in coming week
• EU/Eurozone will look to approve fiscally prudent National budget proposals in November rather than push for any expansion.”

“Risks:

• Amendments to the Election Bill could delay the process of achieving a swift election date
• Adopting a lowering of the voting age to 16 and including EU nationals could cause the Election Bill to be pulled
• Polling reports could shift to suggest a further inconclusive result and another ineffective minority Government
• EU data upside surprises
• EU nations outline fiscally expansionary or structural reform policies.”