Central Banks


More hawkish comments sends the GBPUSD back higher

BOE’s Ramsden is
more hawkish in his comments and that has led to a quick rebound in the GBPUSD. 


Says:

  • MPC view that UK economic
    slowdown in early 2018 was temporary appears to beborne out by recent data
  • Expects UK GDP growth to
    resume at steady but unspectacular pace, conditional on smooth transition
    to eventual post-Brexit arrangement
  • Even subdued pace of growth
    is enough to exceed lower economic speed limit of around 1.5%
  • Our view of outlook and
    prescription for monetary policy remains conditional on data optimistic
    about technology leading to productivity gains and potentially higher,
    noninflationary wage growth
  • He backed MPC view and made
    that ongoing tightening of monetary policy was appropriate if economy
    develops as expected
  • Inflation persistently above
    target and sustained period of excess demand would represent a failure to
    meet our remit
  • The period of unusually
    subdued growth in wages appears to be coming to an end

The GBPUSD has
rebounded on the more hawkish views and that has taken the price back above the 1.3398 resistance level (see earlier post). The price did not stay below the red line and it makes the tests of the MA lines (see blue lines) and the 38.2%, simply a corrective (and successful) test. 



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