Baxia Markets
June 25, 2024

GBPUSD Stalls as Market Awaits BoE and Fed Rate Decisions

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The Pound Sterling (GBP) gained strength during Tuesday's New York session due to uncertainty about the timing of the Bank of England's (BoE) interest rate cuts. Markets anticipate the BoE will announce a rate cut in August, the first since the Covid-19 pandemic, as policymakers signal a readiness to ease their restrictive stance.GBP/USD Stalls as Market Awaits BoE and Fed Rate Decisions

BoE Governor Andrew Bailey mentioned that the decision to maintain rates at 5.25% was "finely balanced," with seven officials voting to keep rates steady and two favoring a cut. Although inflation has returned to the BoE's 2% target, wage inflation concerns remain.

The GBP/USD pair has stalled around 1.2700 after recovering from a five-week low of 1.2620. The price action shows a ceiling near the EMA 200, highlighted by a Dark Cloud candlestick pattern and a shooting star formation. The pair is struggling to stay above the cloud after a breakout, with key support at the bottom of the cloud. If prices fall below the cloud, a bearish continuation is likely.


Key Takeaways

  1. The Pound Sterling rose amid uncertainty about the BoE's interest rate cut timing.
  2. Markets expect the BoE to cut rates in August for the first time since the pandemic.
  3. BoE Governor Bailey highlighted a "finely balanced" decision on keeping rates steady.
  4. GBP/USD stalled around 1.2700, hitting resistance at the EMA 200.
  5. Technical indicators show potential bearish continuation if GBP/USD falls below the cloud support.

Key Economic Releases to Watch Today

Time Currency Event Impact Actual Forecast Previous
07:30 AUD Westpac Consumer Confidence Index Medium 83.6 82 82.2
07:30 AUD Westpac Consumer Confidence Change High 1.7% -0.1% -0.3%
14:00 EUR GDP Growth Rate QoQ Final Medium 0.8% 0.7% 0.7%
14:00 EUR GDP Growth Rate YoY Final Medium 2.5% 2.4% 2.1%
18:00 USD Fed Bowman Speech Medium      
19:30 CAD Core Inflation Rate MoM High 0.6% 0.2% 0.2%
19:30 CAD CPI Trimmed-Mean YoY High 2.9% 2.8% 2.9%
19:30 CAD CPI Median YoY High 2.8% 2.6% 2.6%
19:30 CAD Inflation Rate YoY High 2.9% 2.6% 2.7%
19:30 CAD Inflation Rate MoM High 0.6% 0.3% 0.5%
19:30 CAD Core Inflation Rate YoY High 1.8% 1.6% 1.6%
20:00 USD Chicago Fed National Activity Index Medium 0.18 -0.4 -0.23
20:00 USD S&P/Case-Shiller Home Price YoY Medium 7.2% 6.9% 7.5%
20:00 USD S&P/Case-Shiller Home Price MoM Medium 1.4% 1.1% 1.6%
21:00 USD CB Consumer Confidence High 100.4 100 102
23:00 USD Fed Cook Speech Medium      


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