Credit Suisse discusses GBP outlook and highlights 0.91 in EURGBP and 1.25 in GBPUSD as the next likely targets.
"The debate on the government’s proposal will take place in Parliament over the next few days, with the votes on proposed amendments and eventually on the deal taking place on Tuesday 11 December. The vote is closely followed by the EU Summit on 13-14 December: the purpose of the summit is reportedly to finalize the Brexit agreement, but the most likely scenario, as things stand, is that PM May will show up at the summit empty handed, having suffered a defeat in the 11 December vote," CS notes.
"All of these involve considerable amounts of uncertainty and will continue in our view to give markets reasons to not price out the “no deal” outcome.
Combined with the more benign pricing of downside GBP surprises implied by risk reversal skews, we think this creates potential for GBP to continue to underperform in the coming weeks, with 0.91 in EURGBP and 1.25 in GBPUSD as the next likely targets," CS argues.