Pound Back to Being Bearish After a Brief Bounce
Arslan Butt • 1 min read
For the first time since Boris Johnson took over as UK’s PM, the Pound managed to gain some strength against the dollar briefly on Wednesday. However, this move was driven more by traders being cautious towards the US dollar ahead of Fed’s meeting.
For now, the weakness in GBP/USD is back and getting more pronounced, with the forex pair trading at 1.212 at the time of writing. PM Boris Johnson continues the rhetoric around leaving the EU on October 31, with or without a deal, exerting more pressure on UK’s economy as well as the currency.
Wednesday’s upward move was also driven by optimistic consumer survey data, but the no-deal Brexit scenario weighs heavily and continues to drive the Pound’s bearish moves after that brief bounce to above the 1.22 level.
Today, GBP traders will be eyeing the Bank of England’s meeting for signs of a possible cut in interest rates. Most traders are anticipating that the central bank will leave rates on hold for now, but cut them by the end of this year.