Nomura International says weakness in UK economic data won't continue into Q2
The firm's FX strategist, Jordan Rochester, says that "the data surprises in the UK are at the lows and for this to continue you'd have to expect a severe economic slowdown". Adding that "the best is yet to come" for the pound.
They maintain their bearish view on the dollar and recommend entering a long position in cable at 1.3640 with a target of 1.4100, and a stop level of 1.3480. Well, looks like the trade is at a discount now with cable trading under 1.3600. A good bargain?
If you recall, they made a call for cable to reach 1.48 by year-end last week here. And they also revised their call for a BOE rate hike in May, but now sees the central bank raising rates in August instead.
