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Forex pairs in this Article » GBP/USD
FXstreet.com (Barcelona) - GBP/USD is about two things today, and those are the BoE minutes and the UK Claimant Count Change.

GBP/USD is steady at the lower level of this weeks range ahead of the details that will come in at 830GMT. The pair reached a high yesterday through the 1.5500 level to 1.5513 but this morning it resides a touch above the overnight low of 1.5428 at 1.5435.

A Big day for Sterling

Alvin Pontoh, FX & Rates Strategy at TD Securities said that it is a big day for the UK, with the first round of labour market data since the BoE set the unemployment rate as a threshold for monetary policy, as well as the minutes from the August BoEmeeting. “For the u-rate, as we wrote in last week’s Big Three publication, we see the risk of a higher (worse) reading, and expect to see the unemployment rate rise from 7.8% to 7.9-8.0% in June (mkt 7.8%). The implication would be that rather than the BoE looking for mid-2016 as when it thinks it would see the u-rate rate threshold hit, that date would move back to 2017, which is something that may finally see short sterling rally”.

BoE Minutes

He said as for the minutes, “our understanding is that the MPC held three votes – one on Bank Rate, one on QE, and an additional one on forward guidance. Our view is that there may be a little more dissent than markets are prepared for, and we’re looking for a vote of 9-0 for Bank Rate unchanged, 8-1 for QE unchanged, with Miles continuing to dissent for another £25bn of QE, and 8-1 or possibly 7-2 for forward guidance. That said, the market reaction is more likely to be driven by the unemployment data, since BoE has been clear in making that a key indicator to watch”.

GBP/USD remaing bid overall

Analyst, Axel Rudolph, at Commerzbank said while the 200 day moving average at 1.5526 caps, further weakness remains in store. “Having said that, since last week’s rally looks directional we still have to allow for a stab to the 1.5605/58 resistance area unfolding. It consists of the May peak and uptrend channel resistance line. If overcome, a challenge of the 1.5752/55 June high and the 200-week moving average could still be seen. GBP/USD will remain overall bid while trading above the two month uptrend channel line at 1.5233”.
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