GBP/TWD Outlook: Slightly positive, but likely to move sideways, as the rate is above its recent average and lacks a clear driver.
Key drivers:
• Rate gap: The Bank of England is expected to maintain interest rates, while the rate-cutting outlook could bring some support to the TWD.
• Risk/commodities: Recent stability in oil prices suggests no imminent volatility that would heavily impact either currency.
• One macro factor: The recently signed trade agreement between Taiwan and the US may enhance TWD's demand but could take time to fully influence currency movements.
Range: GBP/TWD is likely to drift within its recent range, showing stability but possibly limited upside.
What could change it:
• Upside risk: A surprising shift in the Bank of England's outlook could support the GBP significantly.
• Downside risk: Increased foreign currency demand from Taiwanese insurers unwinding hedges could pressure the TWD.