GBP/USD Forecast: BOE shy on tightening, pound ticks higher
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFERGBP/USD Current price: 1.3932
- BOE kept its monetary policy unchanged, hinted at “modest” tightening.
- Policymakers foresee temporary higher inflation up to 4% YoY.
- GBP/USD is neutral-to-bullish, sellers await around 1.4000.
The GBP/USD pair regained the 1.3900 level, currently trading at around 1.3930, the pound was little moved by the Bank of England that announced its decision on monetary policy. As widely anticipated, the central bank left its benchmark rate unchanged at 0.1%, and facilities programs were also on hold. Policymakers forecast inflation could rise to 4% in the last quarter of the year but added it would prove temporary. They indicated that “some modest tightening of monetary policy is likely to be necessary” over the next couple of years.
The pair seesawed between gains and losses after the BOE, gaining most ground during the American session amid a better market’s mood. The UK won’t publish macroeconomic data on Friday. Meanwhile, the country is reporting roughly 30,000 new coronavirus cases per day, although there’s no pressure on the health system while the number of deaths is reduced.
GBP/USD short-term technical outlook
The GBP/USD pair is neutral-to-bullish in the near-term. The 4-hour chart shows that technical indicators lack directional strength and remain stuck around their midlines. At the same time, the pair is developing above all of its moving averages, which anyway remain flat, with the 20 SMA providing dynamic support around the 1.3900 level. The bullish potential is limited as sellers will likely continue to defend the 1.4000 threshold.
Support levels: 1.3900 1.3865 1.3820
Resistance levels: 1.3960 1.4000 1.4045
GBP/USD Current price: 1.3932
- BOE kept its monetary policy unchanged, hinted at “modest” tightening.
- Policymakers foresee temporary higher inflation up to 4% YoY.
- GBP/USD is neutral-to-bullish, sellers await around 1.4000.
The GBP/USD pair regained the 1.3900 level, currently trading at around 1.3930, the pound was little moved by the Bank of England that announced its decision on monetary policy. As widely anticipated, the central bank left its benchmark rate unchanged at 0.1%, and facilities programs were also on hold. Policymakers forecast inflation could rise to 4% in the last quarter of the year but added it would prove temporary. They indicated that “some modest tightening of monetary policy is likely to be necessary” over the next couple of years.
The pair seesawed between gains and losses after the BOE, gaining most ground during the American session amid a better market’s mood. The UK won’t publish macroeconomic data on Friday. Meanwhile, the country is reporting roughly 30,000 new coronavirus cases per day, although there’s no pressure on the health system while the number of deaths is reduced.
GBP/USD short-term technical outlook
The GBP/USD pair is neutral-to-bullish in the near-term. The 4-hour chart shows that technical indicators lack directional strength and remain stuck around their midlines. At the same time, the pair is developing above all of its moving averages, which anyway remain flat, with the 20 SMA providing dynamic support around the 1.3900 level. The bullish potential is limited as sellers will likely continue to defend the 1.4000 threshold.
Support levels: 1.3900 1.3865 1.3820
Resistance levels: 1.3960 1.4000 1.4045
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.