GBP/USD holds support below 1.2600. Economists at Scotiabank analyze the pair’s outlook.

Cable based around 1.2590/1.2600

Markets continue to reflect the expectation that the BoE will hold off until August before easing. Rate expectations are perhaps providing the GBP with a bit of a cushion against the USD’s advance.

Sterling has rebounded modestly from the earlier session low. The GBP/USD pair based around 1.2590/1.2600, effectively a retest of the 200-Day Moving Average where Cable has found support in the recent past. 

Gains through 1.2640/1.2650 resistance are needed to give the GBP an additional lift from here, however.