US bank's attitude towards pound turns neutral, expecting new prime minister to bring intensive news.

The strategists at Bank of America have softened their "out-of-consensus bullish view" on the pound, expecting that with ongoing political uncertainty, the recent gains in the pound will retreat. Led by Kamal Sharma, the strategists stated in a report that following the "sharp, rapid increase" in the pound earlier this month, they have shifted their view on the pound to short-term neutral. With a new government in place, the market will seek a new balance. "For this reason, and with the euro/sterling falling below 0.85, we maintain a neutral stance on the pound," wrote Sharma. "Although it is the summer market now, news in the coming weeks may continue to be constant."