GBP/USD Daily Fundamental Forecast – September 8, 2017

The GBPUSD pair spent the last 24 hours piggybacking on the euro but it has to be said that once the pair had broken through the 1.3030 region, it was pretty much clear that it was going to make its way through towards its range highs near the 1.3250 region and now it appears that it is only a matter of time before it does so.

GBPUSD PiggyBacks on the Euro

Yesterday, it was not much about the pound as there was no news from the UK to affect its price but it was more about the euro and the dollar. For the euro, it was all about what Draghi had to say and once his press conference was out of the way, the euro bulls and the dollar bears got to work and this helped to push the GBPUSD pair also higher. After a brief period of correction towards the 1.3040 region, which was pretty much expected and forecasted, the pair made its way through the 1.31 region during the course of the day.

The GBPUSD pair now rests above the 1.3100 comfortably and looks good for more. There has not been anything that had fundamentally changed with the UK economy and the incoming data has also only been steady at best but it has all been about the weakness in the dollar and the story has been the same over the last few months. The Fed has not done anything to support the dollar at any point of time and this has begun to show on the dollar. In fact, it could be that the Fed wants the dollar to be weak as a policy matter and in that,they seem to have achieved what they wanted.

Looking ahead to the rest of the day, we do not have any major news from the UK or the US for the day but the weakness in the dollar is likely to continue for the short term and this should push the GBPUSD pair towards the range highs above 1.32.