GBP/USD Fundamental Forecast – September 7, 2016

The GBP/USD continued to climb adding 42 points today to trade at 1.3346. The pound is trading at its highest level since the Brexit vote. The UK currency gained to near a 7-week high against the dollar on Tuesday, amid expectations that Britain had probably dodged a recession in coming months with the economy showing signs of resilience in the aftermath of the shock Brexit vote.

The pound also hit a four-week peak against the euro, with sentiment bolstered by the recent slew of robust data that has lessened the chances of further monetary easing by the Bank of England.

On Monday, the Purchasing Managers’ Index (PMI) for the dominant services sector showed the biggest one-month gain in the survey’s 20-year history, beating all forecasts in a Reuters poll. The survey echoed the upbeat tone of data released last week on the manufacturing and construction sectors in August and bolstered a view that the economy was holding up well so far.

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Upcoming Economic Events that you should be monitoring:

 September 7, 2016

Government Bond Auctions

Date Time Country Auction

Sep 07 10:30 Denmark Holds bond auction

Sep 07 11:03 Sweden Holds bond auction

Sep 07 11:30 Germany Eur 5bn 0% Aug 2026 Bund

Sep 08 11:00 Ireland Holds bond auction

Sep 08 17:20 Italy Announces details of bond auction