Forex Flash: Short-squeeze pushes GBP higher - UBS

Wednesday and Thursday the pound underwent a larger correction, notes the UBS analyst team. "Investors were squeezed out of GBP-short positions leading to remarkable gains for the pound".

"There was no reasonable trigger from the macro-economic or political side for that move. Key market focus remains the presentation of the budget on March 20, where the UK treasury is expected to discuss a potential change of the inflation target", UBS says. "We expect no significant change and stay therefore with our call for a stronger pound".