GBP/USD Price Forecast – Sterling Opens Flat on Silent Macro Calendar and Standstill Brexit Proceedings

Sterling sees a quiet Monday on the econ calendar as investors focus on market sentiment to place short term bets. GDP figures due later this week will give markets a hint about whether or not the BoE should be as bullish as it has been recently. Brexit proceedings continue to remain same with no major changes over weekend resulting in lack of any trigger in favor of British pound as market opens for the week. The GBP/USD is trading flatly after Friday failed to generate a decisive continuation of last week’s bullish reversal while an abnormally bullish BoE is running counterpart to bearish waffling on Brexit negotiations. The GBP/USD is trading into 1.3250, a familiar level recently as Brexit quarrels and swings in broader market sentiment have seen the Pound freeze near recent technical levels after last weeks bounce from the GBP/USD’s bounce from its last major low.

GBPUSD Quiet

The Sterling rebounded last week after a surprisingly bullish showing for the Bank of England (BoE), which had 3 of its 9 voting members push for a rate hike at the central bank’s last meeting. The BoE’s more-hawkish-than-expected stance has revived hopes for the GBP, but resistance has formed at current levels as Brexit continues to weigh on the UK’s markets. Prime Minister Theresa May is still ignoring calls to prepare for a hard-Brexit scenario, opting to trust her gut and continue to try and negotiate a workable trade agreement with the EU’s leadership in Brussels, a move that is continuing to raise skepticism on both sides of the Channel. GDP figures to be released later this week on Thursday will further cement the BoE’s newfound hawkish stance if the release is good, but another slump for key economic figures for the UK will see a continued decline for the Pound as the BoE gets pushed further back off of their hawkish perch.

Monday sees little action for the GBP on the economic calendar, though the USD could catch a ride if New Home Sales numbers, releasing at 14:00 GMT, deviate from the forecasts excessively, with markets expecting a reading of 666 thousand versus the previous showing of 662 thousand. The week ahead brings a speech from the BoE’s Mark Carney on Wednesday, and traders will be looking ahead for an update to the central bank’s hawkish leanings. Currently traders focus is expected to remain split between trade war related tensions and Brexit proceedings and expected support and resistance for the pair are at 1.3205 / 1.3170 and 1.3280 / 1.3315 respectively.