GBP/USD Daily Fundamental Forecast – March 5, 2018
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The pound has struggled to make much of a move over the last couple of days despite the weakness in the dollar that has been seen across many of the instruments. The dollar has been hit hard by the decision of the US administration to impose tariffs on import of metals but that does not seem to have helped the pound in any way.
GBPUSD Continues Under Pressure
The pound continues to trade in a weak manner in the 1.38 region and has been unable to make much of a headway during the last couple of days when the dollar has been on the backfoot. We are seeing the GBPUSD consolidating and ranging and this has been happening despite the hawkish tone of the BOE last month. Even the speeches from Carney and May over last week has failed to spark a recovery in the pound and we see that it continues to trade weakly as the traders do not anticipate that the BOE would be able to help much if the economy is hit badly due to the Brexit process.
So the BOE seems to be at the ready to hike rates whenever it is needed and also to keep up with the rising rates in many of the other developed countries, the traders and the investors are not too convinced. Also, the incoming data over the past couple of weeks has only managed to just meet the expectations so far and this has added to the worries of the investors as they believe that the BOE would not be able to do much with the available tools with the incoming data continuing to be only steady at best.
Looking ahead to the rest of the day, we have the non-manufacturing PMI data from the US and we also have the services PMI data from the UK and these are likely to bring in a bit of volatility. But this week is going to be important for determining the short term trend with a slew of data on the schedule which includes the NFP and the ADP.
This article was originally posted on FX Empire