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
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bullish
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/WQLZ1X7gIY
  • but the next major point in my view to monitor will be 52.76 - at least in the short term.
  • #Brent having broken above the pre-OPEC drop off at 45.51 is a huge deal considering it failed to crack resistance there in August (leading to the invalidation of "uptrend 2") and the psychological significance of that level https://t.co/LkEyRxFhnq
  • The New Zealand Dollar looks poised to extend its push higher against its haven-associated counterparts on robust economic data and a less dovish stance from the RBNZ. Get your $NZD market update from @DanielGMoss here:https://t.co/vytr4OR1Jy https://t.co/ZcxEUWIm8O
  • It seems the markets are riding high, but risk is always lurking around the corner. Consider your escape plan before you find yourself in collapsing market. What are the top havens for different conditions in 2020? Find out from @JohnKicklighter here: https://t.co/1oeXWEsJkb https://t.co/x8uyOHLtgE
  • The Swiss Franc may continue higher against the US Dollar as technical pressure favors USD/CHF bears..Get your $USDCHF market update from @FxWestwater here:https://t.co/yqJbbhAWiu https://t.co/CaMR0Vqd1m
  • The US Dollar lost ground to most ASEAN currencies as Emerging Market assets climbed despite US economic woes. USD/INR is eyeing third-quarter Indian GDP at the end of the week. Get your market update from @ddubrovskyFX here:https://t.co/urDN2b5Nwd https://t.co/toSDbVZCSi
  • The global stock market can be categorized into specific groups or ‘stock market sectors’. Organizing the vast number of stocks in this way helps traders to view assets in a more manageable way. Get your stock market sectors basics here: https://t.co/5gbiHmY8yl https://t.co/mQ6ty8Yalv
  • The Euro looks poised to continue gaining ground against haven-associated currencies and may reverse higher against the British Pound in the near term. Get your #Euro market update from @DanielGMoss here:https://t.co/oRIHju7ZzK https://t.co/dIEErVzWEY
  • Gold and silver prices have come under significant pressure recently. However, this correction lower could prove short-lived as price analysis hints at a reversal higher. Get your $XAUUSD market update from @DanielGMoss here:https://t.co/K1qL0fsGwy https://t.co/tRfjlN6X22
GBPUSD Weaker After Bank of England Neutral Hold

GBPUSD Weaker After Bank of England Neutral Hold

2018-05-10 11:40:00
Justin McQueen, Analyst
Share:

GBPUSD Analysis and News

  • GBP falls following the Bank of England’s 7-2 neutral hold; Inflation and GDP forecasts lowered
  • Market Pricing for an August Rate Hike Falls to 42% from 62% prior to announcement

For a more in-depth analysis on Sterling, check out the Q2 Forecast for GBP/USD

GBP Bulls Left Disappointed

GBP Bulls left well and truly disappointed after the Bank of England Quarterly Inflation Report with GBPUSD falling from 1.3600 to a low of 1.3509, while the FTSE 100 and Gilts rose to intra-day highs. The BoE had left the bank rate unchanged at 0.5% with McCafferty and Saunders the typical hawkish dissenters, while inflation and GDP forecasts had been lowered amid the soft start to 2018.

Bank of England Forecast

GBPUSD Weaker After Bank of England Neutral Hold

Source: Bank of England

Rate Hike Bets Unwind

The MPC stated that the slowing in Q1 GDP growth had been overstated in the prelim release and believed that over time Q1 will be revised higher to 0.3% and thereafter look for 0.4% in Q2, while noting that CPI appeared to have peaked with theimpact of GBP depreciation likely to fade a little faster than previously thought. Following these comments, OIS markets saw an unwind of rate hike bets with the August meeting now seen at a 42% chance from 62% prior to the release, while a full 25bps rate hike is now not seen in 2018 with the central bank reiterating that any rate hikes will be gradual and limited.

GBP/USDPRICE CHART 1: 1-MINUTE TIME FRAME (MAY 10th)

GBPUSD Weaker After Bank of England Neutral Hold

Chart by IG

See how retail traders are positioning in GBPUSD as well as other major FX pairs on an intraday basis using the DailyFX speculative positioning data on the sentiment page.

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

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

DISCLOSURES