|

GBP/USD analysis: BOE offers not hope, will inflation?

GBP/USD Current price: 1.3427

  • BOE dovish and data-dependent, economic growth now a major concern.
  • UK yearly core inflation expected to have ticked lower to 2.2% in April from 2.3%.

The GBP/USD pair attempted to regain the upside and traded as high as 1.3491, but was unable to hold on to gains and retreated toward the1.3430/40 price zone. BOE's members testified before a parliamentary special committee on inflation,  offering quite a dovish stance. Carney remarked that rates will remain low as long as the UK economy doesn't pick up, dashing hopes for an August hike. UK April inflation will take the spotlight this Wednesday, as the kingdom will release CPI, PPI, and Retail Price Index figures. Core yearly CPI is foreseen at 2.2% from previous 2.3% retreating further from the peaks set above 3.0% and closer to BOE's comfort level. With inflation back to "normal" is now economic growth what's holding back the UK Central Bank. Technically, the 4 hours chart shows that a bearish 20 SMA keeps containing advances, now at around 1.3450, while technical indicators remain within bearish territory, the RSI lacking directional strength at 42 and the Momentum advancing modestly, all of which maintains the risk leaned to the downside.

Support levels:  1.3390 1.3355 1.3320

Resistance levels: 1.3450 1.3490 1.3520  

View Live Chart for the GBP/USD

Author

Valeria Bednarik

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

More from Valeria Bednarik
Share:

Editor's Picks

EUR/USD off highs, back to around 1.1900

EUR/USD keeps its strong bid bias in place despite recedeing to the 1.1900 zone following earlier peaks north of 1.1900 the figure on Monday. The US Dollar remains under pressure, as traders stay on the sidelines ahead of Wednesday’s key January jobs report, leaving the pair room to extend its upward trend for now.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold picks up pace, retargets $5,100

Gold gathers fresh steam, challenging daily highs en route to the $5,100 mark per troy ounce in the latter part of Monday’s session. The precious metal finds support from fresh signs of continued buying by the PBoC, while expectations that the Fed could lean more dovish also collaborate with the uptick.

Crypto Today: Bitcoin steadies around $70,000, Ethereum and XRP remain under pressure 

Bitcoin hovers around $70,000, up near 15% from last week's low of $60,000 despite low retail demand. Ethereum delicately holds $2,000 support as weak technicals weigh amid declining futures Open Interest. XRP seeks support above $1.40 after facing rejection at $1.54 during the previous week's sharp rebound.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Ripple exposed to volatility amid low retail interest, modest fund inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.