Pound-Dollar: Citi Says Too Soon to Sell USD - Pound Sterling Live
At a Glance
Citi argues it is too early to sell the US dollar, suggesting the greenback may have further room to strengthen before a turn lower. The comment, while lacking a specific GBP/USD target, implies a patient approach to any bearish USD positioning.
Key Takeaways
- 01Citi advises against selling the dollar too soon, indicating further USD strength ahead.
- 02GBP/USD consensus targets remain low, with a 1.04-1.12 range among major banks.
- 03Goldman Sachs stands out with a bullish GBP view, contrasting with Citi's dollar-positive stance.
Full Analysis
What the desk is arguing
Citi's FX desk warns it is premature to sell the US dollar, pushing back against nascent calls for a dollar peak. The bank likely sees resilience in US data or a delayed Fed pivot as reasons to remain long USD.
The desk implicitly rejects the narrative that the dollar's recent rally is over, betting that the market is pricing in too much Fed easing too quickly. They see further upside before the USD weakens meaningfully.
Where it sits in our coverage
Our internal consensus target for GBP/USD stands at 1.075 by end-2026, with a firm spread of 1.04-1.12. Citi's cautious USD view aligns with our below-consensus GBP/USD forecast, as a stronger dollar suppresses cable.
Specific firm targets: - Barclays (1.10, Mar26) - JPMorgan (1.08, Dec26) - Goldman Sachs (1.15, Dec26)
How other firms see it
Citi is aligned with the consensus view that a strong dollar persists in the near term. However, Goldman Sachs is more bullish on GBP, targeting 1.15 by end-2026, implying a contrarian stance to Citi's caution.
Other notable stances: - Barclays: aligned with Citi, targeting 1.10 - JPMorgan: aligned, targeting 1.08 - BofA: contrary, targeting 1.04, seeing earlier GBP recovery
Market Implications
Citi's view reinforces near-term USD bullishness, likely capping GBP/USD rallies. Positioning may be slow to shift, keeping cable below 1.10 in coming months.
From the original
Pound-Dollar: Citi Says Too Soon to Sell USD Pound Sterling Live
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