To bet on the pound

Forex strategists from Deutsche Bank advise their customer to make purchases of GBP. The long positions GBP/EUR are particularly attractive. Tree main factors explain this recommendation.

First, the recent slowdown in the dynamics of GBP subsequently led to rise of the pair EUR/GBP from the perspective of the present interest differential.

Second, the markets continue to sell the British currency. "The information about speculative positions, published last Tuesday revealed prevailing short positions in sterling, despite the changes in positioning of the dollar against other currencies like the kiwi and the Swiss franc. In other words, asset managers barely have cut huge amount of short positions in the pound, and reports indicate that the increase in wages was made thanks to the lower cost of production of British companies ", commented from the bank.

Third, the cyclical indicators give us ground to expect a continuation of the upward potential. Deutsche Bank analytics believe that  the base salaries will continue to increase.