GBP/USD is edging higher, regaining the 1.31 area. Economists at Scotiabank analyze the pair’s outlook.

Sterling retains a comfortable yield advantage over the USD along the curve

Sterling retains a comfortable yield advantage over the USD along the curve which will cushion losses and keep the broader GBP tone positive. 

After a couple of sessions of downward drift and consolidation, Cable is perking up again and breaking out – bullishly – from its short-term consolidation range (bull flag). 

A push to/through 1.3150 is likely in the short run. Broader trends point to gains extending to 1.33. 

Intraday support is 1.3075/80.