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4 Jun 2015
GBP/USD testing highs near 1.5440
FXStreet (Mumbai) - The British pound pierced through the 1.54 handle and remains heavily bid against the American dollar in the mid-European session, lifting GBP/USD to fresh weekly highs. The cable rallied nearly 100 pips largely on the back of a broadly weaker US dollar as markets now await BOE’s policy decision for further momentum.
BOE Policy meet in focus
The GBP/USD pair trades 0.57% lower at 1.5427, retreating from fresh one-week highs at 1.5441 reached some minutes ago. The major shaved off losses and extended beyond 1.54 barrier mainly driven by broad based US dollar sell-off sparked by strengthening EUR/USD, shooting beyond 1.13 mark. The US dollar index, measuring the relative strength of the greenback against a basket of six major currencies, reversed previous gains and plunged nearly -0.60% to trade at 94.80 levels.
Meanwhile, markets now await BOE monetary policy decision due later today. BOE policymakers are expected to leave the monetary policy unchanged today at its rate decision, as inflation remains significantly weak and is expected to remain close to zero before rising again toward the end of this year.
Analysts at Rabobank noted, "recent UK economic data are suggesting that the pace of economic expansion may have moderated, we don’t see a rate hike before May 2016 and the money market is currently anticipating that steady policy could prevail until next summer."
GBP/USD Levels to consider
The pair has an immediate resistance at 1.5379 (May 26 High) above which gains could be extended to 1.5500 levels. On the flip side, support is seen at 1.5352 (May 26 Low) below which it could extend losses to 1.5300 levels.
BOE Policy meet in focus
The GBP/USD pair trades 0.57% lower at 1.5427, retreating from fresh one-week highs at 1.5441 reached some minutes ago. The major shaved off losses and extended beyond 1.54 barrier mainly driven by broad based US dollar sell-off sparked by strengthening EUR/USD, shooting beyond 1.13 mark. The US dollar index, measuring the relative strength of the greenback against a basket of six major currencies, reversed previous gains and plunged nearly -0.60% to trade at 94.80 levels.
Meanwhile, markets now await BOE monetary policy decision due later today. BOE policymakers are expected to leave the monetary policy unchanged today at its rate decision, as inflation remains significantly weak and is expected to remain close to zero before rising again toward the end of this year.
Analysts at Rabobank noted, "recent UK economic data are suggesting that the pace of economic expansion may have moderated, we don’t see a rate hike before May 2016 and the money market is currently anticipating that steady policy could prevail until next summer."
GBP/USD Levels to consider
The pair has an immediate resistance at 1.5379 (May 26 High) above which gains could be extended to 1.5500 levels. On the flip side, support is seen at 1.5352 (May 26 Low) below which it could extend losses to 1.5300 levels.