Credit Agricole CIB FX Strategy Research discusses its outlook for the EUR, USD, and GBP for the week ahead.
On the EUR front, CACIB notes that indications next week that this will be the likely course of events in Spain could help investors refocus their attention on the improving Eurozone fundamentals and the October ECB meeting.
CACIB remains long EUR against USD* and CHF* in spot and against the JPY via options.
On the GBP front CACIB thinks that ahead of next week’s EU summit, investors will look for any indications that the Brexit negotiations are moving past the ‘divorce settlement’ stage and towards discussions of future trade arrangements.
"While politics may continue to cloud the outlook for GBP, potential positive surprises from the upcoming UK CPI and labour market data should provide GBP with some support," CACIB argues.
Finally CACIB notes that investors will likely remain caution on the USD over the coming few weeks.
"Uncertainty surrounding the nomination of Fed Chair Yellen’s successor or the timing of President Trump’s tax reform does not help the currency either. USD-investors remain wary of the return of any geopolitical risks as well," CACIB adds.