GBP/QAR Outlook:
The GBP/QAR rate is slightly positive, trading above its recent average and positioned near the upper end of its three-month range. This situation reflects pressure on the pound due to anticipated interest rate cuts from the Bank of England.
Key drivers:
- Rate gap: The Bank of England's cautious approach contrasts with the Qatari Central Bank's stabilization efforts, causing downward pressure on the GBP.
- Risk/commodities: Oil prices are currently elevated and above average, which supports the Qatari riyal, given its peg to the US dollar.
- One macro factor: Recent troubling UK employment data has raised concerns about slower economic growth, which may prompt the BoE to reconsider its interest rate policy.
Range:
The GBP/QAR is likely to drift within its recent range as market dynamics stabilize.
What could change it:
- Upside risk: A surprise increase in UK inflation could boost the pound.
- Downside risk: Further negative employment data may accelerate rate cut expectations from the BoE.