GBP/USD Forecast: 1.2050 support could fail on strong US Core CPI
GBP/USD has gone into a consolidation phase near 1.2100 as market participants get ready for the highly-anticipated July Consumer Price Index (CPI) figures from the US.
Following the Fed's decision to abandon rate guidance and become data-dependent, the market pricing of the size of the Federal Reserve's next rate increase could be impacted in a meaningful way on US data. As it currently stands, there is a 66.5% probability of the Fed hiking by 75 basis points in September. Although this market positioning suggests that the reaction to soft inflation data is likely to be more significant than a strong one, a dollar rally shouldn't be ruled out, especially if the Core CPI comes in higher than analysts forecast. Read more...
GBP/USD: Unlikely to see gains over the coming weeks – MUFG
GBP/USD lacks follow-through beyond 1.21. Economists at MUFG expect the British pound to continue struggling over the coming weeks.
“The BoE is forecasting GDP contraction for five consecutive quarters commencing in Q4 2022 and the baseline assumptions do not assume energy supply restrictions that result in blackouts and potentially major disruptions so we’d expect this story if confirmed to undermine confidence in the outlook for growth even further.” Read more...
GBP/USD to challenge critical support at 1.2050 on high US Core CPI
GBP/USD has been moving sideways at around 1.2100. 1.2050 support could fail on strong US Core CPI, FXStreet’s Eren Sengezer reports.
“An unexpected fall in the Core CPI reading could trigger a dollar sell-off and open the door for a decisive recovery in GBP/USD. With the UK economy facing a high risk of recession before the end of the year, however, investors could refrain from betting on long-term GBP strength and key technical levels could cap the pair's upside in the near term.” Read more...
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