GBP/AED Outlook:
The GBP/AED pair is slightly positive but likely to move sideways, as the rate is above its recent average but lacks a clear driver to push it further. Trading near recent highs reflects some resilience, despite uncertainties in upcoming UK economic data.
Key drivers:
- Rate gap: The Bank of England has held interest rates steady while the UAE Central Bank recently cut rates, causing a divergence that pressures the GBP against the AED.
- Risk/commodities: With oil prices stable, the strong dirham has retained its value, contributing to the relative stability of the GBP/AED pair.
- One macro factor: The UK jobs report is due soon, which could indicate further slowing in the labor market and impacts on the pound if results are weak.
Range:
Expect the GBP/AED to drift within its recent range, remaining stable but susceptible to shifts based on forthcoming data.
What could change it:
- Upside risk: Improved UK employment data could strengthen the pound.
- Downside risk: A disappointing UK jobs report may weaken the pound against the dirham.
