Bias: bearish-to-range-bound, as the GBP remains below the 90-day average while positioned in the lower half of the 3-month range.
Key drivers:
• Rate gap: The Bank of England's cautious approach to further rate cuts contrasts with Qatar's stable financial conditions, supporting QAR strength.
• Risk/commodities: Current oil prices are above average, which supports QAR due to Qatar's oil-linked economy.
• Macro factor: UK economic growth projections show a slowdown, contributing to uncertainty for the GBP.
Range: The GBP/QAR rate is likely to hold within its recent range, with limited potential for significant movement in either direction.
What could change it:
• Upside risk: A surprise improvement in UK economic data could strengthen the GBP.
• Downside risk: Continued geopolitical tensions could amplify demand for safe-haven currencies, pushing the GBP lower.