Daily Analysis GBPUSD - 18 July 2023

Inflation has remained stubbornly high, boosting expectations of higher for longer UK rates. BOE has responded by maintaining its aggressive stance on interest rates, hiking by more than expected in June, taking rates to the highest level since 2008. The market is pricing rates rising above 6% from the current 5%.

Wednesday will see the release of U.K. inflation figures, as the Bank of England prepares for its latest monetary policy meeting on Aug. 1. A second consecutive 50 basis point hike remains a possibility after strong wage growth in the three months to May.

The GBP/USD is continuing the correction toward the 1.3000 support level. The correction is needed before continuing up if the Wednesday data came higher to help the pair reach the 1.3200 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3310	1.3200	1.3000	1.2650	1.2540	1.2460