GBP/USD Forecast: Risky to bet on a steady Pound Sterling recovery
GBP/USD broke through 1.2200 on Tuesday and extended its slide to a fresh six-month low below 1.2150. The near-term technical picture shows that the pair remains oversold. Investors, however, could opt to wait for a steady improvement in risk mood before positioning themselves for a convincing recovery in the pair.
Wall Street's main indexes lost more than 1% on Tuesday amid growing fears over a US government shutdown. Although US stock index futures trade modestly higher, participants could refrain from betting on a risk rally unless Republicans and Democrats agree on a bipartisan spending bill ahead of Sunday's deadline. Read more...
How much further will the GBP/USD drop?
In today's analytical review, our attention turns to the GBPUSD pair, colloquially known as 'cable', which has been caught in a notable downward trajectory, particularly in recent days. The unfavorable performance throughout September, compounded by a lackluster August, prompts an essential question: how much further can this pair potentially descend?
The initial signs of distress surfaced towards the tail end of July and early August. This was marked by the breach of two critical uptrend lines, highlighted in blue and red. Since that pivotal juncture, the descent has been palpable. Read more...
Pound Sterling drops as UK’s high CPI and weak labor demand trigger stagflation risk
The Pound Sterling (GBP) extends its five-day losing spell as investors foresee the United Kingdom economy shifting into a recession due to deteriorating labor market conditions and a poor demand outlook. The GBP/USD pair is expected to deliver more losses as a pause in the rate-tightening cycle by the Bank of England (BoE) would elevate consumer inflation expectations.
BoE’s unexpected pause in its historically aggressive rate cycle has not only highlighted policymakers’ concern about the UK’s economic turmoil, but it has also raised uncertainty over the inflation outlook. Britain’s energy prices have been propelled by the global oil rally and are set to make inflation hotter again. Read more...
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