If rates do go up by as much as is priced in (and I very much doubt they will) the rises will be increasingly ineffective in supporting the currency, given that they will be a reaction purely to high inflation, as the economy slows. Markets expect a further 150 basis points in rate rises by year-end. The market's forecasts for 2022/23 U.K. economic growth also look too high as rising prices squeeze real incomes. A realistic target for GBP/USD is 1.25. - Société Générale FX Strategist
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