News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Bullish
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
More View more
Real Time News
  • *BREAKING: Turkish Central Bank regains independence $TRY https://t.co/HwvrRtf08F
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/38gTDn8ejP https://t.co/ZcLzt2QlSZ
  • Heads Up:🇬🇧 Winter Economy Plan due at 11:30 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-09-24
  • 🇲🇽 Mid-month Inflation Rate YoY (SEP) Actual: 4.1% Expected: 4.05% Previous: 3.99% https://www.dailyfx.com/economic-calendar#2020-09-24
  • 🇲🇽 Mid-month Inflation Rate MoM (SEP) Actual: 0.16% Expected: 0.12% Previous: 0.24% https://www.dailyfx.com/economic-calendar#2020-09-24
  • Chinese Yuan to garner attention amid the FTSE Russell review of Chinese bonds - Expectations are for Chinese bonds to be included in the WGBI - Last month had been the 21st consecutive month of foreign investors increasing exposure to Chinese bonds #CNH
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.76%, while traders in EUR/GBP are at opposite extremes with 66.47%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/TuU1FF6X7g
  • Heads Up:🇵🇱 Monetary Policy Meeting Minutes due at 11:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-09-24
  • Heads Up:🇲🇽 Mid-month Inflation Rate YoY (SEP) due at 11:00 GMT (15min) Expected: 4.05% Previous: 3.99% https://www.dailyfx.com/economic-calendar#2020-09-24
  • Heads Up:🇲🇽 Mid-month Inflation Rate MoM (SEP) due at 11:00 GMT (15min) Expected: 0.12% Previous: 0.24% https://www.dailyfx.com/economic-calendar#2020-09-24
GBP/USD Unfazed by Brexit Trigger; More Fed Rhetoric, NFP on Tap

GBP/USD Unfazed by Brexit Trigger; More Fed Rhetoric, NFP on Tap

2017-04-01 02:57:00
David Song, Strategist
Share:
GBP/USD Unfazed by Brexit Trigger; More Fed Rhetoric, NFP on Tap

Fundamental Forecast for the British Pound: Neutral

Despite all the anticipation surrounding ‘Brexit,’ the British Pound is little changed even as the U.K. officially triggers Article 50 of the Lisbon Treaty, and GBP/USD may continue to operate within the range from earlier this year as both the Bank of England (BoE) and the Federal Reserve are expected to retain their current policies for the foreseeable future.

Following the 8 to 1 split in March, the recent data prints coming out of the U.K. economy may spur a growing dissent within the Monetary Policy Committee (MPC) as the headline reading for U.K. price growth exceeds the 2% target for the first time since 2013. In turn, the BoE may show a greater willingness to move away from its easing cycle especially as officials persistently warn ‘there are limits to the extent that above-target inflation can be tolerate.’ However, the rift may be short-lived as Kristin Forbes is scheduled to depart from the central bank at the end of June.

Indeed, board member Ian McCafferty appeared to be taming interest rate expectations earlier this week, with the official largely emphasizing that the MPC will raise the benchmark interest rate when it becomes appropriate, and the majority may continue to endorse a wait-and-see approach as the central bank argues ‘monetary policy can respond, in either direction.’ As a result, Governor Mark Carney and Co. may make further attempts to buy more time as the decoupling from the European Union (EU) clouds the economic outlook for the U.K., and the lack of urgency to remove the highly accommodative policy stance may continue to cast a long-term bearish outlook for GBP/USD as the Federal Reserve appears to be on course to implement higher borrowing-costs over the coming months.

Market participants may pay increased attention to the key developments coming out of the U.S. as another slew of Fed officials (New York Fed President William Dudley, Philadelphia Fed President Patrick Harker, Fed Governor Daniel Tarullo) are scheduled to speak throughout the first full-week of April, while U.S. Non-Farm Payrolls (NFP) are projected to increase another 175L in March. Recent comments from Fed Vice-Chair Stanley Fischer suggests the central bank remains on course to implement three or four rate-hikes in 2017 despite the uncertainty surrounding fiscal policy, and a batch of hawkish central bank rhetoric paired with a further improvement in the labor market dynamics may heighten the appeal of the greenback as it puts increased pressure on the FOMC to raise the federal funds rate sooner rather than later.

For More In-Depth Updates, Join DailyFX Currency Analyst David Song for Weekly LIVE Analysis & Overview!

GBP/USD Unfazed by Brexit Trigger; More Fed Rhetoric, NFP on Tap

With that said, the limited reaction to Brexit may stoke a larger rebound in GBP/USD as the pair extends the recent series of higher highs & lows, but the failed attempts to break above the Fibonacci overlap around 1.2630 (38.2% expansion) to 1.2680 (50% retracement) keeps the broader outlook tilted to the downside especially as GBP/USD preserves the bearish trend carried over from late-2016. In turn, the pound-dollar exchange rate may continue consolidate within the range from earlier this year should the pair struggle to mark a meaningful test of the March high (1.2615) over the coming week.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES