Oct 03 , 2022 03:45 AM ET
By: AnalysisWatch
Sterling has returned to pre "fiscal event" levels following news of a political turnaround. ING economists expect GBP/USD to range from 1.1000-1.1350.
EUR/GBP could find support at 0.8700.
"Liz Truss' government will formally backtrack on its plan to abolish the 45% income tax bracket. "We believe this move is rather symbolic, as it is less about the amount of money it will save (a few billions) and more about the poor signal it has given of ideological (unfunded) tax cuts."
"Cable has returned to levels seen just before Chancellor Kwasi Kwarteng pronounced the infamous "fiscal event" and it would now be hard to argue that cable should trade much higher than that. But this alleviates the risk of cable trading at par to the extent that it shows Downing Street will show greater respect for financial markets when considering policy options. "