The GBP/USD was hit on two fronts last week, leading to another lower close. The first wave of selling came following some negative comments about the
The GBP/USD was hit on two fronts last week, leading to another lower close. The first wave of selling came following some negative comments about the economy from a Bank of England policymaker on Thursday. The second, following the release of a strong U.S. Non-Farm Payrolls report at end the week.
Sellers hit the British Pound last week after BOE policymaker Ben Broadbent said the recovery may not be strong enough to warrant higher rates. Additional negative news came in the form of reports showing British services and manufacturing growth losing momentum. House prices also declined.
Sellers showed up again on Friday, following the release of the September jobs report which showed the U.S. economy added 248,000 new jobs versus pre-report estimates of 215,000. The unemployment rate also fell below 6.0%. The news drove up U.S. interest rates which made the dollar a more attractive investment over the British Pound.
Doubts about U.K. monetary policy could put pressure on the GBP/USD again this week. Traders will get more clarity about the state of the economy and the timing of the expected rate hike by the central bank when the Bank of England policymakers meet on Thursday, October 9. The early forecast is for the BOE to leave its benchmark interest rate unchanged along with its current level of quantitative easing.
High Impact Economic Events That Traders Should Be Aware Of This Coming Week
Currency Event Forecast Previous
Monday, October 6
There are on high impact economic events today.
Tuesday, October 7
GBP Manufacturing Production m/m 0.2% 0.3%
Wednesday, October 8
USD FOMC Meeting Minutes
Thursday, October 9
GBP Asset Purchase Facility 375B 375B
GBP Official Bank Rate 0.50% 0.50%
GBP MPC Rate Statement
USD Unemployment Claims 291K 287K
Friday, October 10
There are on high impact economic events today.
James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.