- Pound bounces to 1.3185, erases earlier losses.
- The pound rises before the closing time of the London session.
- GBP/USD unlikely to rise significantly above 1.32/33 – ING.
The GBP has erased earlier losses during the US session on Friday. The pair GBP/USD it has rebounded strongly from 1.3110 to intraday highs of 1.3185 so far.
The pound turns positive on the daily charts
GBP/USD has risen more than 0.5% in the last few hours, to erase the drop in the European trading session. In the absence of meaningful macroeconomic releases, position squaring moves before the London closing bell could be behind the pound’s rally.
The pound had traded lower so far, weighed down by the Bank of England’s dovish statement after releasing its monetary policy decision on Thursday, while the market’s dovish mood as hopes for progress in Russia-Ukraine peace talks starting to fade has favored the safe-haven USD, thus increasing negative pressure on the British pound.
Beyond that, investors have remained cautious, reluctant to take excessive risks ahead of the conference between Biden and Chinese President Xi Jinping, after the US warned China of major consequences if it decides to send military aid to China. Russia.
GBP/USD: Levels close to 1.32/33, the best scenario for a long time – ING
From a longer-term perspective, ING FX analysts are skeptical of a significant sterling rally in the coming months: “Unlike the Fed, the BoE did a cautious 25bp rate hike, and one dissenter voted for unchanged rates. The market has removed roughly a 25 bps hike from its expectations this year (the bank rate is now trading at 1.90% in December) (…) Given that we heavily favor the dollar this summer, levels around 1.32/33 for the pound may be the best for some time. .”
Technical levels
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
