- Pound unable to break above 1.3930 versus US dollar.
- GBP/USD in positive territory for the day, still facing bearish pressure.
The GBP/USD climbed to 1.3925 after the beginning of the American session and then pulled back to 1.3882. Cable is hovering around 1.3900 moving sideways on Monday, in positive ground for the day, but still facing some bearish pressure.
The US dollar is moving without a clear direction. Hours ago it rose across the board and then it gave away most of those gains as US yields kept moving to the downside and as equity prices in the US turned negative. The DXY is up by 0.03% at 91.85 while the 10-year yield stands at 1.48%, near Friday’s lows.
Investors await key economic reports ahead in the US, with special attention to Friday’s NFP. Month-end flows could trigger some extra volatility in the sessions ahead.
Regarding the UK, analysts at ING point out that it should be a calm week for data and also sterling. “The UK-EU trade dispute has calmed and it seems the grace period on chilled meats imports to NI will be extended. The BoE did not bring too much surprise this week and although a little bit more hawkish than expected, still the MPC refrained from pointing at earlier rate hikes. This suggests some stabilisation in sterling ahead and should EUR/USD continue its slow recovery to and above the 1.20 level, it should bring GBP higher with it.”
