- The GBP/USD is stuck about 1,3300 before the Fed and BOE presentations.
- The Fed is expected to keep the rates without changes again while the rhetoric of those responsible for the FED occupies the center of the stage.
- It is widely expected that the BOE deliver another cut of a quarter quarter this week.
The GBP/USD interrupted a short -term losses streak, braking and keeping stable near the 1,3300 zone to start a new week of operations. The cable remains below the recent maximum of several years, but the price action has pushed a waiting pattern before the key presentations of the Federal Reserve (Fed) and the Bank of England (BOE).
The Fed is expected to maintain interest rates without changes at the moment, a movement that will probably attract more criticism from the Trump administration, which is still determined to try to obtain early feats of the president of the Fed, Jerome Powell. Employment and inflation figures largely balanced, with inaccurate and opaque commercial policies of the White House firing their own hopes of feet cuts in the foot, since the Fed remains committed to its mandate of maintaining unemployment and price volatility under control.
Although the decision to maintain Fed’s rates is practically secured this week, President Powell’s words will have an additional weight for investors after the FED rate decision on Wednesday. The markets still wait for a new cycle of feat cuts, and the operators will be attentive to any moderation signal by those responsible for the Fed.
On the United Kingdom side, the BOE is expected to deliver another rate cut of a quarter cord on Thursday. The Monetary Policy Committee (MPC) of the BOE Vote 9 to 1 in favor of a 25 basic points are expected.
GBP/USD price forecast
GBP/USD operators found the purchase button on Monday, stopping a four -day loss streak that dragged 1.37%to the cable. Despite stopping the short -term fall, the bullish potential remains limited, with technical oscillators trapped in a slow average range. The pair seems to be prepared for a slow return after a strong rebound from the 200 -day exponential mobile average (EMA) about 1,2750 in early April.
GBP/USD daily graphics
LIBRA ESTERLINA FAQS
The sterling pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most commercialized currency exchange unit (FX) in the world, representing 12% of all transactions, with an average of $ 630 billion a day, according to data from 2022. Its key commercial peers are GBP/USD, which represents 11% of FX, GBP/JPY (3%) and EUR/GBP (2%). The sterling pound is issued by the Bank of England (BOE).
The most important factor that influences the value of sterling pound is the monetary policy decided by the Bank of England. The Bank of England bases its decisions itself has achieved its main objective of “price stability”: a constant inflation rate of around 2%. Its main tool to achieve this is the adjustment of interest rates. When inflation is too high, the Bank of England will try to control it by raising interest rates, which makes access to credit for people and companies more expensive. This is generally positive for sterling pound, since higher interest rates make the United Kingdom a more attractive place for global investors to invest their money. When inflation falls too much it is a sign that economic growth is slowing down. In this scenario, the Bank of England will consider lowering interest rates to reduce credit, so that companies will borrow more to invest in projects that generate growth.
Published data measure the health of the economy and can affect the value of sterling pound. Indicators such as GDP, manufacturing and services PMI and employment can influence the direction of the sterling pound.
Another important fact that is published and affects the pound sterling is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will benefit exclusively from the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
