GBPJPY Range Resistance (July 07, 2017)
GBPJPY has been moving back and forth between support around the 138.50 and the range resistance at 147.50-148.00 visible on the daily time frame. Price is currently testing the resistance and could be due for a drop back to support. Stochastic is indicating overbought conditions, which means that sellers could take over while buyers take a break.
However, the 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. This means that the resistance is more likely to break than to hold, possibly sending the pair up by 900 pips or the same height as the rectangle pattern.
The yen has been giving up ground against its rivals recently on the BOJ’s dovish monetary policy stance and the rise in US bond yields. Japan’s average cash earnings figure and the leading indicators are lined up for release and strong data could still shore up demand for the Japanese currency.
Another event risk for the yen is the upcoming US jobs report which might influence bond yields. Strong results could draw traders back to US assets and out of the yen while weak figures could renew yen gains. As for the pound, UK manufacturing and industrial production figures are due, with analysts expecting to see stronger gains this time.
By Kate Curtis from Trader’s Way
GBPAUD Channel Support (July 10, 2017)
GBPAUD has been trading inside an ascending channel pattern visible on its 4-hour time frame and is currently testing support. A bounce could take it back up to the resistance at 1.7150 to 1.7200 while a breakdown could mark the start of a reversal.
The 100 SMA is still above the longer-term 200 SMA so the path of least resistance is to the upside. In addition, the 200 SMA lines up with the bottom of the channel, adding to its strength as support. At the same time, stochastic is heading up from the oversold area to signal a return in bullish pressure.
Economic data from the UK turned out mostly weaker than expected last week, from its PMI readings to manufacturing production data, to signal that the economy might be on shaky footing leading up to Brexit. UK jobs data is up for release today and a higher number of claimants at 10.4K versus the earlier 7.3K is expected, but traders are likely to pay closer attention to the average earnings index to see any signs of wage growth.
Meanwhile, the Aussie was also weighed down by a less upbeat RBA decision. Only medium-tier reports are due from the Australian economy this week so weak readings could underscore the central bank’s not so hawkish view. NAB business confidence, Australian home loans, and Westpac consumer sentiment data are lined up.
By Kate Curtis from Trader’s Way
EURAUD Area of Interest (July 11, 2017)
EURAUD is trending higher recently and has been moving inside an ascending channel on its 1-hour time frame. Price just bounced off the resistance and could be due for a test of support at the 1.4900 major psychological level.
Applying the Fib tool on the latest swing low and high shows that the 61.8% retracement level coincides with the channel support. If this keeps losses at bay, price could recover to the channel resistance at 1.5100 or higher. In addition, the channel support lines up with a former resistance level, adding to its strength as a floor.
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. This short-term moving average is currently holding as dynamic support but a larger pullback to the 200 SMA closer to the 50% Fib might be in order. Stochastic is already indicating oversold conditions but has yet to pull up to reflect a return in bullish momentum.
Economic data from the euro zone came in line with expectations on Monday, with the German trade balance widening from a surplus of 19.7 billion EUR to 20.3 billion EUR and the Sentix investor confidence index dipping from 28.4 to 28.3. There were no reports from Australia but China did print a weaker than expected CPI reading of 1.5% versus the consensus of a climb to 1.6%.
Up ahead, Australia will report its NAB business confidence index and home loans figure. The housing market in Australia has been under the spotlight after Moody’s downgraded four of its top banks due to exposure to risky mortgages. Only the Italian industrial production is due from the euro zone next, although traders are likely to keep speculations of ECB tapering in play unless economic reports disappoint.
By Kate Curtis from Trader’s Way
NZDUSD Short-Term Retracement (July 12, 2017)
NZDUSD recently broke below support at the .7250 minor psychological level and dipped close to the .7200 handle before showing signs of a correction. Applying the Fib tool on the latest swing high and low on the 1-hour time frame shows that the 50% retracement level coincides with the broken support.
The 100 SMA is below the longer-term 200 SMA to signal that the path of least resistance is to the downside. The gap between the moving averages is getting wider to reflect stronger selling pressure.
Stochastic is still pointing up to signal that buyers are in control of price action for now. A larger correction could last until the 61.8% Fib at .7270 or until the 200 SMA dynamic inflection point while a break past that area could mean that bulls are back in control.
Fed officials shared mixed views on the timing of future rate hikes and balance sheet unwinding. FOMC members Brainard and Kashkari also stressed the need to wait for more inflation data to see if the slowdown is temporary before tightening again.
There have been no major reports from New Zealand so the Kiwi has been sensitive to market sentiment and counter currency price action. Fed head Yellen has a speech coming up and more cautious remarks could mean more losses for the dollar.
By Kate Curtis from Trader’s Way
EURGBP Channel Retracement (July 13, 2017)
EURGBP is trending higher on its short-term time frames but it could have room for retracement to nearby support zones. Price is moving inside an ascending channel with support at the .8800 major psychological level.
Applying the Fibonacci retracement tool on the latest swing low and high shows that the 50% level is in line with the mid-channel area of interest and the 100 SMA dynamic support while the longer-term 200 SMA is closer to the 61.8% Fib. The 100 SMA is above the 200 SMA so the path of least resistance is to the upside, which means that the uptrend is more likely to continue than to reverse.
The pair already seems to be bouncing off the 50% Fib around .8850 while stochastic is moving out of the oversold area to signal a return in buying pressure. In that case, price could make its way up to the channel resistance or the swing high from here.
UK economic data turned out stronger than expected as the number of claimants rose by only 6K versus the projected 10.3K increase. The unemployment rate improved from 4.5% to 4.6% but the average earnings index fell from 2.1% to 1.8% as expected.
Economic data from the euro zone also turned out better than expected as the region’s industrial production rose 1.3% versus the projected 1.0% gain and the previous 0.3% uptick. However, the German WPI fell flat instead of posting the projected 0.2% rebound. German and French final CPI readings are due next.
By Kate Curtis from Trader’s Way
EURUSD Breakout and Correction (July 14, 2017)
EURUSD recently broke to the upside of a symmetrical triangle pattern then zoomed up close to the 1.1500 handle before pulling back. Price is retesting the broken triangle resistance which might now hold as support.
Applying the Fib tool on the latest swing low and high shows that the 61.8% level lines up with the broken triangle resistance and is also close to the 1.1400 major psychological support. If this area continues to keep losses in check, the pair could climb back to the swing high or higher.
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. Stochastic is also heading higher to indicate that bullish momentum is in play. A break below the 61.8% Fib, however, could signal that bears are putting up a fight.
Economic reports from the euro zone came in line with expectations. The German final CPI reading was unchanged at 0.2% while the French final CPI was also maintained at a flat reading. Italy’s trade balance and the region’s trade balance are up for release today.
Meanwhile, the dollar had a mixed forex performance as Fed head Yellen shared a relatively balanced view of the economy and its risks. She did reiterate that they could start balance sheet unwinding later this year but warned that they’ll be watching the impact on the yield curve to gauge if future rate changes are still necessary.
US PPI figures came in mixed and the CPI readings are due today. Fed policymakers have been emphasizing how inflation trends will influence their rate hike decisions so stronger than expected results could mean more upside for the US currency. US retail sales are also due, and both headline and core readings could show rebounds.
By Kate Curtis from Trader’s Way
AUDUSD Long-Term Breakout (July 17, 2017)
AUDUSD had been trading inside an ascending triangle on its long-term time frame and has just broken past the resistance at the .7750 minor psychological mark. This signals that the pair is in for an uptrend, which might last by at least 900 pips or the same height as the triangle formation.
The 100 SMA is still below the longer-term 200 SMA on the weekly chart, though, so the path of least resistance is still to the downside. However, the gap between the moving averages is narrowing to signal a potential upside crossover.
Stochastic is pointing up but is already dipping into the overbought zone to indicate weakening bullish pressure. Once the oscillator turns lower, bears could regain control and push for a pullback to the broken resistance. Stronger bearish momentum could put the pair back inside the triangle.
US economic data turned out weaker than expected on Friday, casting doubts again on another Fed interest rate hike in September or December. Headline CPI posted a flat reading instead of the estimated 0.1% uptick while the core CPI had a meager 0.1% gain instead of the estimated 0.2% increase. Headline and core retail sales were down 0.2% while preliminary UoM consumer sentiment also fell short of estimates.
There were no major reports out of Australian then while today has top-tier data from its main trade partner China. GDP is projected to dip from 6.9% to 6.8% while industrial production could hold steady at 6.5%. Retail sales and fixed asset investment could also show small dips. The RBA monetary policy meeting minutes are lined up on Tuesday
By Kate Curtis from Trader’s Way
AUDUSD Bullish Channel (July 18, 2017)
AUDUSD has been trending higher and is moving inside a bullish channel formation on its 4-hour chart. Price is bouncing off the resistance and could be due for a pullback from here. Stochastic is turning lower from the overbought zone to show that buyers are taking a break and allowing sellers to take over.
Applying the Fibonacci retracement tool on the latest swing low and high shows that the 61.8% level lines up with the channel support around the .7650 minor psychological level. The 100 SMA is also close to the bottom of the channel, adding to its strength as support. This short-term SMA is above the longer-term 200 SMA to show that the path of least resistance is still to the upside.
Economic data from China, Australia’s main trade partner, turned out mostly stronger than expected. The economy grew by 6.9% in Q2 versus expectations of a dip to 6.8%. Retail sales and industrial production also ticked higher, reflecting strong internal demand and a likely boost to Australia’s commodity exports.
The RBA will release its monetary policy meeting minutes today and give more insight as to why they decided to keep policy unchanged and when they might consider hiking rates. In the US, economic reports have been mostly weaker than expected lately, particularly when it comes to CPI and retail sales.
Australia will release its jobs report later in the week and likely report a slower increase in hiring. There’s not much in the way of top-tier data from the US this week but traders could start pricing in less upbeat remarks for the FOMC meeting next week.
By Kate Curtis from Trader’s Way
GBPJPY Short-Term Reversal (July 19, 2017)
GBPJPY has failed in its last two attempts to break past the 147.50 minor psychological resistance, creating a double top reversal formation. Price is currently testing the neckline at 145.50 and could be due for at least 200 pips in losses if its breaks.
The 100 SMA is still above the longer-term 200 SMA, though, so the path of least resistance is to the upside. Also, the 100 SMA is holding as dynamic support for now and a bounce could take price back up to the tops or higher. Stochastic looks ready to pull up to indicate a pickup in buying pressure but it has room to go lower before hitting oversold conditions.
Economic data from the UK turned out weaker than expected and BOE Governor Carney confirmed that this was in line with BOE estimates. Headline CPI is down from 2.9% to 2.6% while core CPI dropped from 2.6% to 2.4%, lessening pressure on the central bank to tighten monetary policy.
The BOJ has its monetary policy decision lined up on Thursday’s Asian trading session and many are expecting the Japanese central bank to sound dovish. However, recent reports have shown some improvements and there’s also a chance that policymakers could sound more neutral.
UK retail sales are also due later on this week and a drop is eyed, owing to weak wage inflation and rising price levels. However, analysts project that a 0.4% rebound over the earlier 1.2% slump could be in the cards.
By Kate Curtis from Trader’s Way
GBPUSD Rising Wedge (July 20, 2017)
GBPUSD has formed higher lows and slightly higher highs, creating a rising wedge pattern visible on its daily chart. Price is currently testing the resistance and might be due for a move back to support soon. Stochastic looks ready to head south from the overbought zone so selling pressure could pick up soon.
However, the 100 SMA is above the longer-term 200 SMA so the path of least resistance is still to the upside. This suggests that the wedge support at the 1.2750-1.2800 levels could keep losses in check or that the pair could attempt to break past the resistance at 1.3100.
UK economic data has been weaker than expected so far this week, with headline and core CPI reflecting much weaker inflationary pressures. This reduces the need for the BOE to hike interest rates to keep price levels in check.
The retail sales report is due next and another decline could reinforce the view that spending and growth are taking hits from rising inflation. Consumer spending already fell 1.2% in May and another drop could mean more losses for the pound, but analysts are expecting to see a 0.4% rebound.
As for the US dollar, delays in the Trump administration’s fiscal reform plans are dampening demand for the currency. After all, this could push tax cuts much later into next year and limit growth prospects, lessening the need for the Fed to hike as they start their balance sheet runoff.
By Kate Curtis from Trader’s Way
EURAUD Channel Retracement (July 21, 2017)
EURAUD is trending lower and moving inside a descending channel connecting the highs and lows of price action since the latter part of May. Price is bouncing off the channel support and could be due for a pullback to resistance. Stochastic is moving up to show that buyers are in control of price action but the oscillator is already dipping into the overbought region to signal potential rally exhaustion.
Applying the Fibonacci retracement tool on the latest swing high and low shows that the 61.8% level is closest to the channel resistance around the 1.4850 minor psychological mark. The 100 SMA is above the longer-term 200 SMA for now so the path of least resistance is still to the upside, but a new crossover seems likely and this might draw more sellers to the market.
If any of the Fib levels hold as resistance, price could make another test of the channel lows at 1.4400. On the other hand, sustained buying pressure could spur a break past the channel resistance and start a reversal for EURAUD.
The ECB decided to keep monetary policy unchanged as expected while reiterating that tapering has not been discussed yet. During the presser, Draghi repeated that inflation is not quite up to the level that they’d like to see just yet before trimming asset purchases. He did say that they’re seeing broadening signs of growth but that these have yet to translate to stronger price pressures.
Meanwhile, the Aussie took some hits upon seeing slightly weaker than expected jobs data. The economy added 14K jobs in June versus the projected 14.4K figure and the previous reading was downgraded from 42K to 38K. The jobless rate was unchanged at 5.6%. A couple of RBA policymakers are set to give testimonies today and jawboning remarks are expected.
By Kate Curtis from Trader’s Way
USDCAD Descending Channel (July 24, 2017)
USDCAD keeps trending lower and is moving inside a descending channel pattern on its 1-hour time frame. Price is currently testing support near the 1.2550 minor psychological level and could be due for a bounce back to the resistance near 1.2600.
Stochastic is heading down to show that there’s still some selling pressure left. If sellers are strong enough, they could push for a break of the channel support, triggering a steeper selloff for USDCAD.
The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside, which means that the downtrend is more likely to carry on than to reverse.
Economic data from Canada came in mostly in line with expectations last Friday, except for the core retail sales figure which showed a 0.1% dip instead of the estimated flat reading. Headline retail sales beat expectations with a 0.6% gain, twice as much as the projected 0.3% uptick.
Dollar demand remains weak as traders are starting to price in less hawkish expectations from the FOMC statement this week. Although the minutes of their earlier meeting reflected confidence in their outlook, the latest batch of reports and developments could cloud their optimism.
Traders are also hoping to get more details on the balance sheet runoff and confirmation that it would start later this year could weaken expectations of another interest rate hike in September. Discussions among OPEC and non-OPEC leaders are reportedly scheduled within the day and this could impact Loonie price action as well.
By Kate Curtis from Trader’s Way
EURUSD Channel Correction (July 25, 2017)
EURUSD has been trending higher after breaking past a long-term resistance level last week. Price is trading inside an ascending channel visible on its 1-hour time frame and is currently bouncing off the resistance.
This could spur a correction to the channel support at the 1.1550 minor psychological level, which is close to the 61.8% Fibonacci retracement level on the latest swing low and high. This also coincides with the 200 SMA dynamic support.
Speaking of moving averages, the 100 SMA is above the longer-term 200 SMA on this time frame so the path of least resistance is to the upside. The 100 SMA is near the 38.2% Fib and mid-channel area of interest, which might also be potential support in a shallow correction. Stochastic has been on the move down but seems to be pulling up early.
Economic data from the euro zone was not so impressive at the start of the week. Flash manufacturing and services PMI readings from the top economies were mostly below expectations, except for the French manufacturing PMI, leading many to doubt that the ECB can taper as early as September.
The German Ifo business climate index is lined up today and a dip from 115.1 to 114.9 is expected. Another weaker than expected read could mean more losses for the shared currency as tapering expectations weaken again. As for the dollar, relatively upbeat PMI readings renewed some support ahead of the FOMC decision later this week.
The flash manufacturing PMI is up from 52.0 to 53.2, higher than the forecast at 52.3, while the services PMI held steady from an upgraded 54.2 figure. Existing home sales printed a dip to 5.52M. The CB consumer confidence index is due today and a fall from 118.9 to 116.5 is expected.
By Kate Curtis from Trader’s Way
USDJPY Triangle Support (July 26, 2017)
USDJPY has formed lower highs and higher lows on its 4-hour time frame, trading inside a symmetrical triangle pattern. Price is currently testing support and could be due for a bounce back to resistance.
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. In addition, stochastic is pointing up to indicate that bullish momentum is in play. However, the gap between the moving averages is narrowing to signal a potential downward crossover while the oscillator is nearing overbought levels.
If bearish pressure kicks in, USDJPY could test the triangle support at 111.50 again or attempt to break lower. The chart pattern is approximately 500 pips tall so the resulting breakout could be of the same size.
The main event risk for this pair is the FOMC decision as traders are waiting to find out if the Fed would maintain its hawkish bias or not. Recall that CPI and retail sales have been weaker than expected but there’s a good chance that policymakers might insist that these are due to temporary factors.
Reiterating that they are prepared to hike rates one more time before the year ends and signaling that they could start balance sheet unwinding in September could spur stronger dollar demand. On the other hand, a shift in tone to a more cautious one could trigger losses.
As for Japan, data on household spending and inflation due on Friday could also lead to big yen moves since this could determine whether the BOJ would stick to its dovish stance or not.
By Kate Curtis from Trader’s Way
USDCAD Short-Term Channel (July 27, 2017)
USDCAD continues to trend lower and is moving inside a descending channel visible on the 1-hour time frame. Price is currently testing support and could be due for a pullback to the resistance once more.
Stochastic is pulling up from the oversold area to suggest that profit-taking off the 1.2450 area might take place. The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside. In addition, the 100 SMA lines up with the channel resistance to add to its strength as a ceiling.
The FOMC decided to keep interest rates on hold at 1.00-1.25% as expected after hiking in June. They also signaled that balance sheet unwinding could begin “relatively soon” and that they would stick to reinvesting for now.
What drew dollar bears in was the Fed’s new assessment that overall inflation has declined, compared to their previous statement that it “declined recently” and is “somewhat” below 2%. Still, the Fed noted that hiring has been solid and that household spending and business investment continue to expand.
As for the Canadian dollar, it got another strong boost from an uptick in crude oil. The EIA reported a larger than expected draw of 7.2 million barrels versus the projected reduction of 3.3 million barrels. US durable goods orders data is due next and there are no major reports lined up from Canada.
By Kate Curtis from Trader’s Way
AUDNZD Resistance Turned Support (July 28, 2017)
AUDNZD recently broke past the resistance at the 1.0550 minor psychological level then zoomed up to the 1.0800 levels before pulling back. Applying the Fib tool on the latest swing low and high on the 4-hour time frame shows that the 61.8% level lines up with the broken resistance.
The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. Also, the gap between the moving averages is widening to indicate strengthening bullish pressure. The 100 SMA appears to be holding as dynamic support as well while the 200 SMA is closer to the area of interest.
Stochastic is pointing down to signal that there may be some selling pressure left, but the oscillator is also closing in on the oversold level to indicate potential profit-taking If that happens, buyers could push price back up to the swing high.
Economic data from Australia has not been so upbeat this week, though, as the headline CPI printed a lower than expected 0.2% uptick versus the projected 0.4% gain. Import prices also fell short of consensus for the quarter and hinted of lower price pressures down the line.
Australia just reported a lower than expected quarterly PPI reading of 0.5% versus the projected 0.6% increase, adding to the narrative that inflation could stay subdued and prevent the RBA from tightening anytime soon.
There have been no major reports from New Zealand, leaving the Kiwi at the mercy of market sentiment. This higher-yielding currency usually draws support during risk-on days and tumbles when risk aversion is present.
By Kate Curtis from Trader’s Way
EURCAD Descending Channel (July 31, 2017)
EURCAD has been trending lower, moving inside a descending channel on its 4-hour chart. Price has bounced off support and has made its way towards resistance at the 1.4650 minor psychological level, which might continue to keep gains in check.
If so, another test of support at the 1.4300 major psychological level could take place. The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside. This means that the selloff is more likely to continue than to reverse.
The moving averages appear to be holding as dynamic resistance areas as they line up with the top of the channel. Stochastic is on its way down also, indicating that sellers are in control of price action.
Euro zone data came in mixed on Friday as German and French preliminary CPI beat expectations while French consumer spending fell short. Canada’s GDP also beat expectations with a 0.6% gain versus the projected 0.2% expansion.
Up ahead, German retail sales and the region’s flash CPI readings are due. Stronger than expected figures would assure investors that spending remains supported and that inflation could convince the ECB to move on with tapering asset purchases sooner than initially expected.
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Final manufacturing and services PMIs from the top euro zone economies are lined up for the rest of the week while Canada will release its jobs report on Friday. Analysts are expecting to see a 14.6K increase in hiring.
By Kate Curtis from Trader’s Way
GBPUSD Countertrend Play (Aug 01, 2017)
GBPUSD has been trending higher and moving inside an ascending channel on its daily time frame. Price is making its way to the top of the channel and could be due for a bounce off the 1.3300 major psychological mark. Stochastic is nearing the overbought zone and turning lower could draw sellers back in.
However, the 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. This means that the uptrend is more likely to continue than to reverse. Also, the 100 SMA lines up with the bottom of the channel, adding to its strength as support if price pulls back.
UK net lending to individuals data turned out stronger than expected at 5.6 billion GBP versus the projected fall to 4.9 billion GBP. Mortgage approvals came in line with expectations at 65K. Next up, the UK will print its Nationwide HPI and manufacturing PMI, which is projected to tick back up from 54.3 to 54.4.
The US dollar is being dragged lower by tensions with North Korea and inside the White House itself. The hermit nation recently conducted a successful ICBM test that could potentially hit most of the United States, according to a couple of intelligence officials. Meanwhile, Trump just fired his communications director Scaramucci after 10 days in office. Chicago PMI also turned out weaker than expected with a steep fall to 58.9.
US core PCE price index and personal spending and income data are due next. Analysts are expecting the inflation figure to hold steady at 0.1% while personal spending might also show a meager 0.1% uptick. Personal income could post another 0.4% gain.
By Kate Curtis from Trader’s Way
USDCAD Short-Term Reversal (Aug 02, 2017)
USDCAD failed in its last two attempts to break below the 1.2400 area, creating a double bottom formation on its 1-hour time frame. Price has yet to break past the neckline at 1.2575 before confirming the potential reversal.
The chart pattern is around 175 pips tall so the resulting rally could be of the same size. The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside for now, but the gap is narrowing to signal that an upward crossover might take place soon.
Stochastic is already indicating overbought conditions, which suggests that buyers might want to take a break and let sellers take over. In that case, USDCAD could head back down to form another bottom near 1.2400. RSI is still pointing up so there’s some buying pressure left.
Economic data from the US turned out mostly in line with estimates. The ISM manufacturing PMI fell from 57.8 to 56.3, slightly weaker than the 56.4 consensus. Most of the components chalked up declines while the prices component surged from 55 to 62.
The API report printed a surprise buildup in crude oil stockpiles instead of the projected draw, leading some to speculate that oversupply troubles may be back and that the EIA might report an increase in inventory as well. Underlying inflation figures from Canada have been weaker than expected while the manufacturing PMI showed a faster pace of industry growth.
By Kate Curtis from Trader’s Way
GBPNZD Double Bottom (Aug 03, 2017)
GBPNZD bounced a couple of times off the 1.7400 level, creating a double bottom pattern with a neckline at the 1.7850 minor psychological level. Price has yet to break past the resistance before confirming that a longer-term uptrend is in order.
The 100 SMA is above the longer-term the 200 SMA to confirm that the path of least resistance is to the upside. The 100 SMA is close to the neckline, adding to its strength as resistance. If it holds, another move towards the bottoms could take place.
Stochastic is moving up to show that there’s some bullish momentum in play, possibly enough to trigger a neckline breakout. However, the oscillator is also nearing overbought levels so buyers might want to pause soon and let sellers take over.
The BOE decision is the main event risk for the day as traders are waiting to find out if the central bank can maintain its hawkish views from the previous announcement. At that time, three policymakers voted for a hike on stronger inflationary pressures but the latest batch of CPI readings have disappointed.
A less hawkish bias could push the pound lower against its peers while an actual rate hike might be needed to keep the pound afloat. Other reports have indicated mixed results, with hiring staying strong and retail sales trying to hold steady. Business PMI readings have also reflected some resilience.
As for the Kiwi, the weaker than expected quarterly jobs report released earlier this week could keep the currency on the back foot. Employment fell by 0.2% instead of rising by 0.7% while the previous quarter’s gain was downgraded to 1.1%.
By Kate Curtis from Trader’s Way
