Bank of America becomes the largest pound longs on Wall Street, and it is expected that the pound will rebound strongly in 2025

On December 6th, Kin10 data reported that Bank of America has become the largest long positions in the pound sterling on Wall Street, predicting that the pound sterling against the euro will rise to the highest level since 2016 by 2025, and the pound sterling against the US dollar is expected to pump by 8%. Bank of America expects the pound sterling against the euro to rise to 1.25, the highest level since the 2016 UK Brexit referendum, and the pound sterling against the US dollar will rise to 1.38 by the end of 2025. This is due to the stronger rise of the UK economy compared to the eurozone, as well as the fiscal stimulus and relatively higher interest rates in the UK. The pound sterling is the best-performing G10 currency this year, except for the US dollar. Compared to the recent turmoil in the eurozone’s major economies, the strength of the pound sterling comes from the political stability after the UK election, as well as the market’s expectation that the Bank of England’s interest rate cuts will be slower than the European Central Bank’s. Athanasios Vamvakidis, Global Head of G10 Forex Strategy at Bank of America, stated that the momentum of the pound sterling’s strength is still ongoing.