GBP: To Stay Supported; Still 11% Undervalued - Barclays

Barclays Capital FX Strategy Research expects the GBP to remain supported going into the snap UK general election, but notes that global sentiment amid geopolitical risks is likely to stay a key driver in the near-term.

On  the BoE front, Barclays doesn't expect the central bank to signal any change in policy stance over this coming snap election. 

"We currently estimate the GBP is about 11% below its long­-term fair value on a real effective exchange rate basis. We expect much of this uncertainty discount to be removed over the next few quarters," Barclays argues.

GBP/USD is trading circa 1.2780 as of writing. 

Source: Barclays Research