Sterling shows resilience ahead of Wednesday's UK Budget, though analysts warn that limited upside remains as markets have already priced in significant Bank of England tightening.
OCBC notes GBP resilience but BoE tightening already priced in, capping upside ahead of the UK Budget.
The British Pound maintains unexpected resilience as UK economic growth remains stable and fiscal risks appear contained. Analysts at OCBC suggest that while the currency shows strength, the upside is limited because aggressive Bank of England interest rate hikes are already fully priced into the market.
The upside is capped because investors have already priced in substantial interest rate tightening from the Bank of England, leaving little room for further gains based on monetary policy expectations.