GBPUSD pair is capitalizing on its positive intraday performance, having recently bounced from the 1.20300 area, which was a multi-day low. Prices have now risen above the 1.2100 mark in the last hour, reversing a significant portion of the losses seen last week. This improvement is likely due to a combination of factors, including a resurgence in global risk sentiment. It is therefore evidenced by the turnaround in the equity markets and a softer tone around US Treasury bond yields. All of these developments have hurt the US dollar, thus providing support to the GBP/USD pair.
Hawkish Fed Expectations
The GBPUSD pair is making a recovery from the recent lows, and it appears that the market is responding positively to the current conditions. This is a welcome development, and it will be interesting to see if the current momentum can be sustained in the coming days. The USD selling has provided some support to the GBPUSD pair; however, it is worth noting that hawkish Fed expectations could help limit the USD downside and cap the pair. Nevertheless, the current momentum is encouraging, and it will be interesting to see if the pair can sustain the positive momentum in the near term.
It is important to remember that the Bank of England’s decision last week was based on careful consideration of the current economic climate. This indicates that their assessment is likely to be reliable and should be taken into account when trading. The speech of Fed Governor Michelle Bowman is also likely to be of great importance, as it will provide further insight into the economic outlook. This is especially true in anticipation of the UK jobs data on Tuesday, which will provide further insight into the current state of the economy.
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