Cable Flat Into Europe

The broader post-NFP USD weakness drove cable higher during Friday's London afternoon/NY session. The pair has consolidated Friday's gains although sits a little shy of Friday's peak, last dealing little changed on the day around $1.3825, which still points to relative (modest) outperformance for GBP amongst most of its G10 peers to start the week.

• COVID restrictions have garnered the bulk of the attention in the UK press over the weekend, ahead of UK PM Johnson's announcement on the matter. Broader expectations are now for almost if not all of the restrictions and limitations to be rolled back, with a "common sense" approach set to be pushed by the government, placing some more accountability on personal choice, as opposed to government prescription, per weekend comments from Housing Minister Jenrick.
• Elsewhere, the potential for the M&A backdrop to provide some support for GBP is evident, with Morrison's agreeing to a GBP6.3bn takeover offer from U.S. based Fortress Investment Group (which is a subsidiary of Japan's SoftBank), pending broader approval.
• The June 29 high and the 50-day EMA provide the initial points of resistance, with firmer resistance seen at the June 23 high ($1.4001). In the case of a move lower, Friday's low ($1.3733) and the April 16 low ($1.3717) provide some protection ahead of key support at the April 12 low ($1.3669)
• There is nothing in the way of notable options expiries for the pair evident over the coming the days.
• Today's local focus will fall on the aforementioned address from PM Johnson, as well as the final services & composite PMI readings for the month of June.