GBP/USD held within its recent 1.27-1.32 range despite high COVID-19 case counts and greater restrictions. Progress in EU/UK trade talks could now flip its range to 1.32-1.37, economists at Westpac apprise.
Key quotes
“Data over the next week is dominated by surveys (notably PMI and CBI surveys). Confidence is a key component and will be critically related to both the containment of COVID-19 cases and the risk of failure in EU/UK trade talks.”
“As COVID-19 cases have increased (rising to over 26k in the 24 hours into Wednesday) the UK government has been forced to impose tighter restrictions in North West, North East and Central England as well as N. Ireland, Central Scotland and Wales. Failure to curb the infection rate could force the whole of UK into another economically damaging lockdown, though this is being vehemently resisted by authorities.”
“EU/UK post-Brexit talks appeared to be close to being abandoned at the end of last week. However, potential easing of contentious parts of UK’s Internal Market Bill and possible solutions for EU fishing rights in UK waters could allow intense legal discussions as early as next week. It that transpires, GBP/USD could flip its recent range through 1.3200 (for a 1.32-1.37 range), despite the current rise in COVID-19.”
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.