GBP/USD retreats below 1.4200 amid chatters over Biden’s Brexit role, Yellen
- GBP/USD fades Friday’s recovery moves, remains pressured amid sluggish week-start trading.
- US President Biden’s first visit to Europe highlights multiple issues, including Brexit, to be discussed.
- US Treasury Secretary Yellen pushes for Fed rate hike, battles Friday’s downbeat US NFP.
GBP/USD fails to extend Friday’s recovery moves during a quiet Monday morning in Asia. The cable pair seems to react to the price-negative headlines from the US and concerning the Brexit while taking rounds to 1.4160 by the press time.
Among the key headlines are concerns, backed by The Times, suggesting US President Joe Biden’s meddling into the European Union (EU) and the UK’s tussles over the Northern Ireland (NI) protocol. During his first European visit as the US leader, Biden is likely to pressure UK PM Boris Johnson to break the Brexit deadlock, signaled by The Times. Although UK PM Johnson knows how to avoid the pressure, the same could help the EU to have a better negotiation power and may extend the issue, weighing on the GBP/USD prices afterward.
Elsewhere, weekend comments from US Treasury Secretary Janet Yellen, suggesting the rate is good for the Fed, recently helped the US dollar to recover Friday’s losses, due to the US jobs report’s negative surprise. The comments from ex-Fed Boss renews risk-off mood amid reflation fears.
At home, fears of the Indian covid variant jostles with the jump in vaccinations as well as Brexit woes to tame the GBP/USD prices of late. However, the Bank of England’s (BOE) bullish bias keeps sellers away.
It’s worth noting that a quiet start to the week and a light calendar test GBP/USD traders, highlighting the risk catalysts as the key factors to watch for fresh impulse.
Technical analysis
A one-week-old resistance line joins 10-day SMA to guard the quote’s short-term upside around 1.4165. However, sellers are likely not to take risk of entry beyond the 1.4100 nearby support.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
