The dollar took a break again, going to the correction mode after Wednesday's rally. European currencies are trying to recover due to the increased interest in risk appetite following Wednesday's decision of OPEC to reduce production volumes, which triggered a 10% rally of oil prices.
Especially actively adjusted pair GBP/USD, which had reached a 3-week highs near 1.2660. After the breakdown of the upward movement of 1.26 quotes accelerated, and now the pound is trying to strengthen its position on the psychological level. The key growth driver for the British currency were the optimistic statements of the Minister of Brexit, which tried to weaken the market fears of a "hard Brexit". Players were particularly pleased with the comment that Britain can maintain access to the European single market after leaving EU. This is directly beneficial for the sterling as the British currency will return the attractiveness, shattered after the June referendum.
If we compare the EUR and the GBP, the position of pound look at this stage is much more stable. Status of the British economy, in spite of the "divorce" with the EU, so far eliminates the need for additional stimulus, and the negotiations themselves on an output from the block may last for quite a long period. The ECB, from the other hand, may be forced to extend the program of buying assets, especially in light of the increased political risk in the region.
However, the potential for further strengthening of GBP/USD looks limited due to the fundamental strength of the dollar. Today the US will publish key employment report, which is expected to increase jobs in the area of 170-180 (in my opinion higher than 200) thousand. If expectations are met, players will resume buying USD in anticipation of Fed rate increase at the next meeting.
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