MNI: From ING: GBP: Pound to bounce back as..........>

MNI: From ING: GBP: Pound to bounce back as initial Westminster chaos has been

averted

Prime Minister Theresa May is set to bounce back this week from what has been

described as a 'disastrous' Tory party conference speech by attempting to get a

grip on both the internal strife within her government and the ongoing deadlock

in Brexit negotiations. Talk of a cabinet reshuffle dominated the weekend press,

though the Sunday Times notes that the PM will wait until after the critical

Brexit focused

European Council meeting on 19-20 Oct before making any changes to

her cabinet. Still, the tentative show of unanimity within the cabinet looks to

have

- at least for now - drawn a line under questions about the PM's leadership.

This

might help to ease some of the downward pressure on GBP as fears of imminent

chaos in Westminster have been thwarted. We look for GBP to recover its losses

this week, with GBP/$ moving up to 1.3250-1.3300 (EUR/GBP 0.8860-0.8880).