GBP/USD Forecast: Pound could suffer losses if buyers fail to reclaim 1.2200
GBP/USD has declined sharply in the early European session but managed to recover modestly after having briefly dipped below 1.2200. The near-term technical outlook doesn't offer any clear directional clues but the pair could stay on the back foot in case markets remain risk-averse in the American session.
The PMI data published by the S&P Global revealed on Thursday that the business activity in the UK's manufacturing and service sectors continued to expand at a relatively healthy pace in early June. Although the British pound erased a portion of its daily losses after these data, it could find it difficult to gather further bullish momentum. Read more...
GBP/USD pares intraday losses, keeps the red near 1.2200 mark amid stronger USD
The GBP/USD pair struggled to capitalize on the overnight solid bounce of around 100 pips from the weekly low and attracted some selling for the second successive day on Thursday. Spot prices dropped to the 1.2170-1.2165 area during the early part of the European session, albeit managed to rebound a few pips thereafter.
The US dollar was back in demand amid hawkish Fed expectations and drew additional support from the worsening global economic outlook, which, in turn, exerted downward pressure on the GBP/USD pair. The markets seem convinced that the Fed would stick to its policy tightening path to combat stubbornly high inflation and have been pricing in another 75 bps rate hike at the next FOMC meeting in July. The bets were reaffirmed by Fed Chair Jerome Powell on Wednesday, saying that the ongoing rate increases will be appropriate. Read more...
GBP/USD: Still seen within 1.2040-1.2400 near term – UOB
In the opinion of FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang, GBP/USD should keep navigating the 1.2040-1.2400 range in the next weeks.
24-hour view: “Our expectations for GBP to ‘trade between 1.2225 and 1.2325’ yesterday were incorrect as it plunged briefly to 1.2163, soared to 1.2314 before dropping back down quickly to end the day slightly lower at 1.2265 (-0.11%). The sharp swings have resulted in a mixed outlook and further choppy price actions are not ruled out, likely within a range of 1.2200/1.2310.”
Next 1-3 weeks: “On Monday (20 Jun, spot 1.2225), we highlighted that the outlook is mixed and GBP could continue to trade in a choppy manner, likely between 1.2040 and 1.2400. There is no change in our view and we continue to expect GBP to trade between 1.2040 and 1.2400.” Read more...
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