Monday saw Bank of America Research note...>

STERLING: Monday saw Bank of America Research note that "June could be pivotal

for GBP, with focus on two events: The June 19th EU Summit & the end-month

transition period extension deadline. Idiosyncratic is back on the table but in

the background, the discussion on NIRP is likely to continue and pressure UK

rate spreads vs. G10. Our bias into June is for a weaker GBP and a test of the

range lows. Our preferred expressions would be versus EUR, CHF and JPY. More

significantly, we think GBP implied vol will continue to outperform the G10

complex and is back to levels seen in '16. Whilst April (+ve) and May (-ve) have

historically exhibited strong seasonal trends, the evidence on June is

inconclusive. Since '10, the average decline in GBP/USD through the month has

been -0.5%. June '16 is the obvious outlier when GBP/USD fell over 8% in the

aftermath of the Brexit referendum. Much will therefore depend on the GBP vol

backdrop. Our analysis shows that GBP/USD implied vol vs. G10 counterparts

invariably rises through June (again most notably in '16). We think a further

rise in idiosyncratic vol is likely. UK policy uncertainty has risen markedly in

recent weeks, even after taking into account the UK Covid19 response."