GBP/USD portrays indecision around mid-1.2200s ahead of UK/US PMI data
GBP/USD treads water around 1.2265 during the early Asian session on Thursday, after failing to extend the recovery from a weekly low beyond 1.2315. The cable pair’s latest inaction could be the mixed plays, as well as cautious sentiment ahead of the preliminary PMIs for June month from the UK and the US.
UK inflation indicates that the Bank of England is moving too slow
GBPUSD is now trading at 1.22 - near the psychological low of 1.2000, where it received critical support in 2017 and 2020. But that support may not survive the third test of strength due to an increasingly threatening gap between inflation and interest rates, which would devalue debt. But this is a risky policy that could undermine confidence in the financial system, which will require decisive and brutal measures for the economy to restore.
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