GBP/USD Consolidates in a Range, Bracing for the BOE Rate Decision

The British Pound trades mildly against the US dollar at $1.3164 after placing a high around $1.3230. The bullish trend in all the direct pairs was triggered after more dovish than expected remarks from the Fed Chair Jarom Pawwell. Federal Reserve chose to keep interest rates steady and indicated that no more hikes will be coming this year. After the announcement, 10-year Treasury yields plunged to their weakest level in a year.

As of now, GBP/USD has absorbed the impact of FOMC and Fed fund rate. The pair now is ready to brace the impact of monetary policy.

Retail Sales – The UK retail sales grew by 0.4% in February 2019, with a decline of 1.2% in food stores offset by growth in all other main sectors.

The Bank of England interest-rate decision is due to be announced today at 12:00 (GMT), just a week before the UK’s planned March 29 exit date which is now very likely to be shifted to June 2019. I think it will be unwise to play with the interest rates during this crucial time.

The technical outlook remains mostly unchanged. GBP/USD is facing a strong resistance around 1.3225. During the previous week, the same trading level supported the GBP and now it’s likely to work as a resistance.

The GBP/USD pair is forming a bearish engulfing pattern on the 3-hour chart, suggesting a strong bearish bias of investor. On the lower side, GBP/USD can find support around 1.3050 today.

Summing up, the BOE isn’t expected to hike the rate. In fact, they aren’t even expected to lower it. However, bullish remarks from MPC members can trigger buying in GBP/USD today.

Good luck!

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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