GBP/USD Daily Fundamental Forecast – March 30, 2017

GBPUSD managed to stay without much of an impact for most of the day yesterday despite the fact that Article 50 was finally invoked, as promised yesterday. This was an event that was generally known in the markets for the past couple of months and it was well announced by the UK government much before the actual event took place and hence the market was well prepared. This could be one of the reasons why there was not much of an impact in the prices once the announcement went through.

GBPUSD Stays Stable

We had expected something similar especially when the event was overrun by a day or so as the pair fell hard the day before in anticipation of the Article 50 invocation. The market had been going more and more short in the days leading to the event and the market could not wait much longer and took down the GBPUSD pair on the day before and hence there was not much to react to once the actual announcement came about.

The market also realises that this is just the beginning of the long and hard Brexit process which is going to have a lot of bumps and hard breaks as we go along. The negotiations on the actual process to take and what is to be given by each side and what is to be taken is only going to begin now and both the UK leaders and the Euro leaders have made it pretty clear that the negotiations are going to be hard with each side trying to take advantage of the other.

No one knows what each side is going to get at the end of the Brexit process and it is this uncertainty that is likely to keep the GBPUSD pair pressured in the coming days. Looking ahead to today, we have the US GDP data but no other data event from the UK or the US.