- GBP/USD rises on Friday, ends week lowers amid a stronger US dollar.
- Pound remains relatively calm despite resignations and Brexit uncertainty.
The GBP/USD pair was about to end Friday around daily highs, firm above 1.3200. Earlier dropped to 1.3100, the lowest in a week but then bounced to the upside, on the back of a slide of the greenback across the board. It peaked at 1.3230, 50 pips below the level it had a week ago.
The decline of GBP/USD was in line with the strength showed by the US dollar in the market. Resignations at UK PM May’s cabinet, the presentation of the White Paper for plans after Brexit and Trump’s visit to the UK have no lasting impact on the pound.
Brexit headlines are likely to continue next week. “Another legislative showdown takes place in the UK House of Commons as the Trade and Customs Bills are voted on. Amendments to the bill have come from hard Brexiters (trying to undo the white paper) and Remainers (trying to bind the UK to a customs union). Some of these votes could come down to the wire, and have significant implications for Brexit negotiations”, said analysts at TDS.
Also, UK economic data could play an important role next week. The calendar includes CPI, PPI, retail sales and employment data. Those numbers will be a key input for the next Bank of England meeting, early in August.
In the US, the key economic events will be Fed’s Chair Powell presentation at Congress and retail sales data.
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