fxs_header_sponsor_anchor

News

GBP/USD opens flat at around 1.2580, focus shifts on Fed-BOE policy meet

  • GBP/USD is oscillating below 1.2600 as investors are seeing forward to rate hike announcements.
  • The Fed is going to elevate its interest rate by 50 bps.
  • A 25 bps rate hike is expected by the BOE.

The GBP/USD pair is hovering around 1.2580 and is likely to extend further amid a rebound in the risk-sensitive currencies, witnessed on Friday. The cable attracted significant bids around 1.2510 as responsive buyers found it a value bet and drove it higher. The asset is expected to deliver wild moves this week as the market participants are awaiting the announcement of the interest rate hike by the Federal Reserve (Fed) and Bank of England (BOE) this week.

The Fed is going to bring tremendous uncertainty in the FX domain amid its dominance and expectation of a jumbo rate hike. Multi-decade inflation print at 8.5% and consistency in full-employment levels are advocating a 50 basis point (bps) interest rate hike from Fed policymakers. Along with the hawkish tone on rate announcements, hawkish guidance from the Fed is also expected to contain the inflation mess.

On the sterling front, the Bank of England (BOE) is going to continue the streak of raising interest rates. The BOE elevated its rates in its last meet by 50 bps. This time a similar extent is not expected as the street is forecasting a quarter to a percent rate hike but the streak of hiking the rates will continue to remain intact.

Although interest rate decisions from the Fed and BOE will remain in the spotlight this week, investors will also focus on the US Manufacturing PMI, which is due in the New York session. A preliminary reading for the ISM Manufacturing PMI is 58 against the prior print of 57.1.

 

 

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.