GBP/USD Daily Fundamental Forecast – October 16, 2017

The GBPUSD continues to consolidate since the Friday and the data from the US seems to have had little impact on the pound so far. But this week could be key for the pair as there are loads of data that would be released from the UK during the course of the week and it is likely that the pair is subjected to a lot of volatility during this week.

Pound Continues Consolidation

The pound has been unaffected by the choppy data from the US which is quite unlike the reaction from the other currencies which have had some choppy trading. The pound seems to be waiting for something fundamental on its side to happen before it decides which way it wants to go but so far, that has only led to consolidation and ranging in the pair. The Brexit process continue to looam ahead as far as the UK economy is concerned and that seems to be weighing on the pound.

Over the weekend, we have had reports that say that the UK PM May is expected to go to Brussels to continue the Brexit talks that have been going on for sometime now. There has not been much progress in these talks so far which has led to the risk that the Brexit may happen without a deal being reached at all. That is the scenario under which May is travelling for the talks and this would probably send out a strong signal that she wants to hammer out a deal and take the talks by the scruff. This should be positive for the pound in the short term.

Looking ahead to the rest of the day, we do not have any major data from the UK or the US for the day and so expect some consolidation and ranging to continue as the market positions itself for the slew of data from the UK later in the week.