US Dollar, British Pound, GBP/USD Price Analysis
- The FOMC[1] rate decision from yesterday led into the BoE rate decision this morning.
- The US Dollar[2] put in a bearish move post-FOMC.
- The BoE rate decision added more fuel to the bearish USD[3]-theme, with GBP/USD[4] breaking out to fresh near-term highs.
Fed, Bank of England Bring Some FX Volatility to the Table
It’s been a busy past 18 hours in global markets, as yesterday’s FOMC rate decision led into this morning’s rate meeting at the Bank of England. This was Mr. Mark Carney’s final rate decision atop the BoE, with successor Andrew Bailey set to take over from here. Neither bank made any actual moves but the BoE did cut growth forecasts for the next few years; somewhat of a parting gift from Mark Carney. Nonetheless, the British Pound[5] has thus far gained on the back of this morning’s drivers as there were actual expectations that the bank may have cut this morning, and the fact that they didn’t quickly took rate cut bets out of the market as GBP/USD broke-out to a fresh near-term high.
Perhaps the most notable takeaway at this point has been the pullback in the US Dollar[6]. The Greenback came into this series of drivers with a full head of steam, continuing a January rally that had wiped-out more than 50% of the Q4 sell-off in the currency. That 50% marker at 98.01 in DXY proved to be an item of near-term support that helped to hold the lows in DXY after the FOMC rate decision. That level has now been traded through, aided in-part by the bullish breakout in GBP/USD on the back of this
