الملف المرفق 270278
The market has been in rally mode for much of 2011 thus far but is finally starting to find some offers ahead of critical medium-term resistance in the 1.7000 area. Look for the latest bearish reversal week to act as the catalyst for deeper setbacks ahead with weakness now seen back below 1.6000 and towards 1.5500 over the coming weeks. Ultimately, only back above 1.6750 gives reason for concern.
الملف المرفق 270279
Bank of England interest rate expectations have fallen to their lowest levels year-to-date, hurting the British Pound’s stance against key currency counterparts. It is nonetheless interesting to note that the GBPUSD has actually rallied despite the deterioration in BoE forecasts. US Federal Reserve interest rate expectations have similarly languished, and prospects point to relatively compressed GBPUSD spreads through the foreseeable future.
Overnight Index Swaps point to higher UK interest rates through the coming 12 months. UK inflation remains well-above the Bank of England’s target of 2.0 percent. Yet we will need to see the hawkish camp gain traction in the BoE’s Monetary Policy Committee. Those same OIS point to an August interest rate hike. Any indications that the hike could come sooner or later could force important moves in GBP pairs.