GBP/USD remains firm above 1.2300 after BoE hikes rates

GBP/USD maintains the bullish bias beyond 1.2300.
The BoE raised the policy rate by 25 bps, as expected.
The MPC voted 7-2 to lift the key rate to 4.25%.

Pablo Piovano FXStreet

The upbeat note around the Sterling remains in place and motivates GBP/USD to maintain the daily bullish tone above the 1.2300 region in the wake of the BoE’s decision on rates.

GBP/USD remains bid post-BoE

GBP/USD recedes from earlier tops near 1.2340 and revisits the 1.2300 neighbourhood after the BoE raised the policy rate by 25 bps to 4.25%, as widely expected on Thursday. The vote to hike rates was 7-2, with members Tenreyro and Dhingra favouring an unchanged stance.

From the statement, the central bank still expects inflation to drop significantly in Q2 2023, while it sees the economic activity to increase slightly during the same period.

Regarding the recent effervescence in the banking sector, the Financial Policy Committee (FPC) stressed that the UK banking system remains resilient and maintained robust capital and strong liquidity positions.

GBP/USD levels to consider

As of writing, the pair is gaining 0.40% at 1.2312 and the breakout of 1.2343 (monthly high March 23) would open the door to 1.2447 (2023 high January 23) and then 1.2666 (monthly high May 27 2022). On the other hand, the next support aligns at 1.2146 (55-day SMA) followed by 1.2082 (100-day SMA) and finally 1.2010 (weekly low March 15).

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Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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