GBP/USD erases majority of daily gains, sits comfortably above 1.25


  • BoE's Carney says there is risk of economic disruption from no-deal Brexit.
  • Today's inflation report from the U.S. helps greenback recover its losses.
  • US Dollar Index looks to close the day above the 97 handle.

After rebounding sharply and closing the day above 1.25 on Wednesday, the GBP/USD pair extended its gains and rose to a weekly high of 1.2570 today. However, the pair lost its traction in the second half of the day and erase a large part of its daily upside and was last seen trading at 1.2523, where it was up 0.2% on the day.

Earlier today, in its semi-annual Financial Stability Report (FSR), the Bank of England (BOE) said the market volatility was rise significantly in the case of a no deal Brexit bur said that UK banks would be able to cope with the potential negative impact of a hard Brexit and trade conflict. 

After the statement, "Material risks of economic disruption remain from no-deal Brexit," Bank of England Governor Carney told reporters and added that the financial system was ready for Brexit whatever form it takes to help the British pound preserve its gains against the buck.

Later in the American trading hours, the data published by the U.S. Bureau of Labor Statistics reported that inflation, as measured by the core Consumer Price Index, rose to 2.1% on a yearly basis in July to allow the US Dollar Index to recover from the weekly low that it set at 96.80 today. As of writing, the DXY was posting small daily losses at 97.04.

Commenting on the CPI readings, “Today’s report is consistent with inflation climbing back toward the FOMC’s target in the coming months," said Wells Fargo analysts.

"But Fed officials are increasingly concerned about the generalized weakness in inflation that has persisted this expansion. Although it is starting to get back on track, Fed officials have grown impatient over the time it is taking inflation to return to target on a sustained basis.”

There won't be any macroeconomic data releases from the UK and the Producer Price Index data from the U.S. will be the last potential catalyst.

Technical levels to watch for

GBP/USD

Overview
Today last price 1.252
Today Daily Change 0.0021
Today Daily Change % 0.17
Today daily open 1.2499
 
Trends
Daily SMA20 1.2673
Daily SMA50 1.2795
Daily SMA100 1.2947
Daily SMA200 1.292
Levels
Previous Daily High 1.2522
Previous Daily Low 1.2444
Previous Weekly High 1.2706
Previous Weekly Low 1.2481
Previous Monthly High 1.2784
Previous Monthly Low 1.2506
Daily Fibonacci 38.2% 1.2492
Daily Fibonacci 61.8% 1.2474
Daily Pivot Point S1 1.2455
Daily Pivot Point S2 1.241
Daily Pivot Point S3 1.2377
Daily Pivot Point R1 1.2533
Daily Pivot Point R2 1.2567
Daily Pivot Point R3 1.2611

 

 

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.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex News

Editors’ Picks

EUR/USD chops around amid end-of-month flows, ahead of Trump

EUR/USD is battling 1.11, close to the two-month highs amid choppy trading. Hopes for a fiscal boost in Europe and mixed satisfactory data have supported the currency pair. , Sino-American tensions are rising and investors await President Trump's China announcement.

EUR/USD News

GBP/USD advances amid US dollar weakness, shrugging off concerns

GBP/USD is trading above 1.23, edging higher amid US dollar weakness and Britain's gradual reopening. Intensifying Sino-American tensions and the Brexit impasse are ignored. 

GBP/USD News

Cryptocurrencies: $348M in matured derivatives boost the market

Futures and options contracts' expiration brings a wave of volatility to the crypto market. Ethereum takes advantage and attacks resistances in the market dominance chart, Bitcoin goes back. Ripple disappoints despite regaining the third place in market capitalization.

Read more

Canada's economy falls by 8.2% annualized in Q1, better than expected, USD/CAD shakes

The Canadian economy squeezed by an annualized rate of 8.2% in the first quarter of 2020, better than -10% expected. Quarterly, Gross Domestic Product (GDP) squeezed by 2.1%. Most of the downfall occurred in March, with a drop of 7.2%, better than 8.5% projected. 

Read more

WTI drops 4% and eyes $32 mark amid risk-off, weakening demand

The selling pressure around WTI (July futures on Nymex) accelerates following the break below the 33 level, as bears now target the 32 support zone heading into the key US macro data and US President Donald Trump’s response to the Hong Kong issue.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures