GBP/USD : Choppy Movement
(Fri, 24 July 2020). GBP/USD CHOPPY OVERNIGHT, EU-UK TRADE NEGOTIATIONS REMAIN AT AN IMPASSE
A relatively choppy session thus far for the Pound, which pulled back from its overnight high at 1.2770 to a low of 1.2720. UK retail sales this morning were unsurprisingly better than expected on the month, as retailers opened up. Despite this however, BoE rate setters remain cautious on the UK outlook with BoE’s Haskel the latest member to highlight concerns over the UK recovery path. Elsewhere, the tedious EU-UK trade negotiations showed little in the way of material progress as EU’s Barnier reiterated that significant divergences remain.
GBP/USD LARGELY DRIVEN BY US DOLLAR DYNAMICS, EYES ON JUNE HIGH
That said, the main driver for GBP/USD has been the persistent weakness observed in the US Dollar, which sees the pair maintaining a foothold above 1.2700. While price action has been somewhat indecisive following the break above the 200DMA, we do not rule out a potential test of the June high situated at 1.2813. However, we political concerns remaining for the UK, GBP/USD may struggle to maintain a foothold above 1.28.
GFS ASIA TEAM
- just now