GBP/USD Fundamental Analysis – August 18, 2015 – Forecast

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Updated: Aug 17, 2015, 11:20 UTC

Analysis and Recommendations: The GBP/USD moved between gains and losses as the greenback remained strong today. There is no economic data or headlines

GBP/USD Fundamental Analysis – August 18, 2015 - Forecast

Analysis and Recommendations:

The GBP/USD moved between gains and losses as the greenback remained strong today. There is no economic data or headlines out of the UK today so the pound is expected to remain docile. The pair is trading at 1.5637.

The British Pound outperformed in overnight trade following hawkish comments from Bank of England official Kristin Forbes. A member of the rate-setting MPC committee, Forbes said the UK is in a “solid recovery” and warned that the benchmark policy rate will need to rise before headline inflation hits the target 2 percent. She added that keeping rates low for too long carries distortion risks.

The fundamentals are beginning to suggest that support for the pound may have topped out in the near-term. Yesterday morning’s UK labour market data disappointed, revealing an increase in the total level of domestic joblessness to 1.85m during the three months to the end of June. A Bank of England interest rate hike now appears a long way off and economists forecast that the UK unit will trade with a neutral bias moving forward.

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Today’s economic releases:

Cur.	Event	Actual	Forecast	Previous
JPY	GDP (QoQ) (Q2)	-0.4%	-0.5%	1.1%
JPY	GDP (YoY) (Q2)	-1.6%	-1.9%	4.5%
EUR	Trade Balance (Jun)	26.4B		18.8B
USD	NY Empire State Manufacturing Index		5.00	3.86
CAD	Foreign Securities Purchases (Jun)			-5.45B