GBP/USD erases gains and retraces below 1.2300 post-Fed’s Powell appearance at the US Congress
The British pound remains on the defensive and is edging lower on Wednesday, down by a minimal 0.04% in the North American session. At 1.2272, the GBP/USD remains below the 1.2300 figure, despite a hotter than expected UK inflation, while the US Federal Reserve Chairman Jerome Powell testifies in the US Senate. The GBP/USD reached daily lows around 1.2160 during the day but recovered some ground later in the day, registering a daily high at 1.2314. UK inflation heightened to 40-year highs at 9.1% YoY and was the cause of the pound’s fall. Traders should remember that the Bank of England (BoE) forecasted inflation to rise as high as 11% and projected a contraction by 2023. Read more...
Looking at GBPUSD Chart, we can see that after a big run from around 1.20 to 1.24, it starts dropping to the current level of 1.2180. Today we could expect it to test its support level at around 1.21 and if able to hold its rate above that level then we should expect an upward bounce otherwise it is possible to see it testing again its lowest level for the year at around 1.20.
GBP/USD Forecast: Bears look to dominate after UK inflation data
GBP/USD has met fresh bearish pressure early Wednesday and declined below 1.2200. The risk-averse market environment and soft inflation data from the UK weigh on the pair mid-week and the technical outlook suggests that additional losses are likely in the short term. The UK's Office for National Statistics (ONS) showed on Wednesday that the annual inflation in the UK, as measured by the Consumer Price Index (CPI), edged higher to 9.1% in May as expected. On a positive note, the Core CPI, which excludes volatile food and energy prices, declined to 5.9% on a yearly basis from 6.2% in April. Read more...
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.