2021
The British pound has been on a roller coaster ride in recent years, but CIBC is now forecasting that the GBP/USD exchange rate could reach its highest level since early 2023 in the second quarter of 2021. This would be a significant milestone for the currency pair, which has been trading in a range between 1.15 and 1.20 for the past few months.
The Canadian Imperial Bank of Commerce (CIBC) recently released its quarterly currency forecast, which predicts that the GBP/USD exchange rate will reach 1.24 in the second quarter of 2021. This would represent a nearly 5% increase from its current level of 1.19.
The CIBC report cites several factors that could contribute to the GBP/USD exchange rate reaching its highest level since early 2023. First, the UK economy is expected to continue to improve in 2021, as the country recovers from the effects of the coronavirus pandemic. This should lead to increased demand for the British pound, which could push the exchange rate higher.
Second, the Bank of England is expected to continue to maintain a loose monetary policy in 2021, which should help to support the pound’s value. Finally, the US dollar is expected to remain weak in 2021 due to the ongoing uncertainty surrounding the US economy and politics. This could lead to further depreciation of the US dollar against the British pound, which could push the GBP/USD exchange rate higher.
Overall, CIBC’s forecast of a GBP/USD exchange rate of 1.24 in the second quarter of 2021 is an optimistic outlook for the currency pair. If this prediction proves accurate, it would represent a significant milestone for the British pound and could be a sign of further strength for the currency in 2021. However, it is important to remember that currency markets are unpredictable and that any number of factors could cause the exchange rate to move in either direction. As such, investors should remain vigilant and monitor developments closely before making any decisions regarding their investments.
Source: Plato Data Intelligence: PlatoAiStream
