Daily Analysis GBPUSD - 19 June 2023

The BoE is expected to raise interest rates by another 25 basis points as the central bank grapples with inflation that is running more than four times its target. This decision comes after an improvement in growth numbers and economic activity, following a previous forecast of a recession.

In contrast, the recent Fed meeting and the market's perception that rate hikes may come to an end, particularly considering the latest economic data, which has not yet confirmed an economic slowdown. However, the current rate of 5-5.25% appears to be high enough to have an impact and potentially lead to lower inflation levels and reduced pressure on the labor market. It seems that confidence in central bank projections and their speeches has diminished, given their failure to effectively address inflation over the past two years, resulting in persistent inflationary pressures.

GBPUSD experienced a significant upward movement, breaking even the important resistance level at 1.2670. This has opened the door for further advances as the market appears bullish ahead of the next BOE meeting. The next resistance level is approximately 1.3000, and if a correction occurs, the price may move towards retesting the 1.2670 level.

 

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3200	1.3000	1.2800	1.2650	1.2540	1.2460