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Forex pairs in this Article » GBP/USD (Edinburgh) -The upbeat tone surrounding the sterling remains intact on Wednesday, with buyers pushing the GBP/USD above the psychological level at 1.6000.

GBP/USD bolstered by the BoE

The GBP found the much-needed oxygen after the hawkish tone from the BoE’s Quarterly Inflation Report, where the central bank now sees the jobless rate to hit the 7% threshold by Q3 2015 (Q2 2016 previously). The inflation report followed the positive result from the UK labour market, with the unemployment rate at 7.6% (7.7% exp.) and claimant count dropping by 41.7K. Ross Walker, Analyst at RBS, assessed, “In absolute terms the MPC's forecast retains a 'dovish' element in the sense that the first rise in Bank Rate is being signalled as some way in the future – Governor Carney stressed several times that a 7% unemployment rate is not a trigger for Bank Rate rises and that the MPC will reassess the situation as this threshold is reached. Nevertheless, it is the change that matters (at least for markets) and the data appear to have forced the MPC to shift much more than it had expected to do in a 'hawkish' direction”.

GBP/USD levels to watch

As of writing the pair is up 0.56% at 1.5996 and a breakout of 1.6051 (MA30d) would bring 1.6105 (high Nov.8) and then 1.6115 (high Nov.7). On the downside, the initial support aligns at 1.5854 (low Nov.12) ahead of 1.5844 (50% of 1.5427-1.6260) and finally 1.5776 (low Sep12).
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