City Index
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GBP/USD is currently down around 0.6% for the week, extending last week’s rejection from the upper trendline of its bearish channel that stems back to May.
In theory, yesterday’s record high UK inflation print, and subsequent rally in bond yields, should be supporting the British Pound higher. However, speculation that the BOE will be forced to hike rates aggressively, in spite of forecasts for negative growth, appear to be adding selling pressure on GBP/USD.
At the time of writing, cable has managed to bounce from near 1.2000. This could be an important level for the pair, having already provided support earlier this month, but with most of the UK data for the week behind us, near-term price action may now depend on sentiment surrounding the US economy.
Will the prospect of continued Fed hawkishness boost the Dollar, or will signs of peak US inflation, combined with a cooling economy, cause traders to sell the greenback?
All trading carries risk, but it should be worth keeping an eye on GBP/USD over the coming days.
In theory, yesterday’s record high UK inflation print, and subsequent rally in bond yields, should be supporting the British Pound higher. However, speculation that the BOE will be forced to hike rates aggressively, in spite of forecasts for negative growth, appear to be adding selling pressure on GBP/USD.
At the time of writing, cable has managed to bounce from near 1.2000. This could be an important level for the pair, having already provided support earlier this month, but with most of the UK data for the week behind us, near-term price action may now depend on sentiment surrounding the US economy.
Will the prospect of continued Fed hawkishness boost the Dollar, or will signs of peak US inflation, combined with a cooling economy, cause traders to sell the greenback?
All trading carries risk, but it should be worth keeping an eye on GBP/USD over the coming days.
