GBP/USD in Rally Mode as BoJo Replaces His Finance Minister – 1.32 In Sight?
Risk assets are taking a hit this morning after China announced a 15k surge in COVID-19 (coronavirus) cases following a new diagnostic protocol, reviving fears that the outbreak may be less contained than previously assumed. That said, current data suggests that COVID-19 is less deadly than previous epidemics and generally contained to China for the moment, though risk sentiment could take another tumble if either of these assumptions is called into question in the coming days. One way or another, the disruption to economic activity in China seems poised to stretch into March at this point.
Meanwhile, nearly 9,000km away in London, pound traders are more focused on domestic developments. Specifically, UK Prime Minister Boris Johnson made some significant changes to his cabinet, prominently including his replacement of Finance Minister Sajid David with Rishi Sunak. At first blush, market participants believe that Sunak would be less likely to show resistance to the Prime Minister and may be more likely to institute fiscal stimulus (read: tax cuts and spending increases) than his predecessor. Read more...
GBP/USD Forecast: Boris bulldozes Javid to make way for infrastructure spending, levels to watch
Fire all your advisers if you want to keep your job – that is the message that Prime Minister Boris Johnson conveyed to Sajid Javid, the now-former Chancellor of the Exchequer. The cabinet reshuffle was touted as a minuscule one, leaving all the top cabinet posts unchanged. However, after Johnson – presumably backed by adviser Dominic Cummings – laid down the gun, this rearrangement now includes a market-moving development. Javid refused to accept these conditions and resigned.
The PM reportedly wants to have more control over economic policy, especially infrastructure spending. Javid was seen as a more fiscally-conservative treasurer that would oppose substantial deficit spending.
Javid's departure makes way for Rishi Sunak, who held a more junior post. Sunak may pave the way to broader expenditure on roads, hospitals, and trains – including the controversial and budget-sinking HS2 scheme. Read more...
GBP/USD surges to over 1-week tops, around 1.3040-45 region
The buying interest around the British pound picked up some additional pace in the last hour and lifted the GBP/USD pair to over one-week tops, around the 1.3040 region.
Following an early dip to levels just below mid-1.2900s, the pair regained some positive traction and moved back into the positive territory for the fourth consecutive session on Thursday. The British pound lost some ground in reaction to reports that the UK finance minister Sajid Javid has resigned.
Sterling influenced by UK political developments
The downtick, however, turned out to be short-lived, rather attracted some aggressive dip-buying after the UK government confirmed that Rishi Sunak, the current chief secretary to the Treasury, has been appointed as the new Chancellor. Read more...
|Today last price||1.3066|
|Today Daily Change||0.0107|
|Today Daily Change %||0.83|
|Today daily open||1.2959|
|Previous Daily High||1.2992|
|Previous Daily Low||1.2937|
|Previous Weekly High||1.3184|
|Previous Weekly Low||1.2882|
|Previous Monthly High||1.3281|
|Previous Monthly Low||1.2954|
|Daily Fibonacci 38.2%||1.2971|
|Daily Fibonacci 61.8%||1.2958|
|Daily Pivot Point S1||1.2933|
|Daily Pivot Point S2||1.2907|
|Daily Pivot Point S3||1.2878|
|Daily Pivot Point R1||1.2988|
|Daily Pivot Point R2||1.3018|
|Daily Pivot Point R3||1.3044|
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