Pound Sterling fails to attract buyers ahead of BoE
- GBP/USD trade below 1.3000 in the European session on Thursday.
- The BoE is widely anticipated to leave the policy rate unchanged.
- The near-term technical outlook highlights a lack of buyer interest.
GBP/USD stays on the back foot and trades in negative territory below 1.3000 in the European morning on Thursday as markets assess the latest data releases from the UK, while waiting for the Bank of England’s (BoE) policy announcements.
British Pound PRICE Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the weakest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.27% | 0.24% | -0.10% | 0.15% | 0.63% | 0.83% | -0.11% | |
| EUR | -0.27% | -0.04% | -0.36% | -0.12% | 0.36% | 0.57% | -0.37% | |
| GBP | -0.24% | 0.04% | -0.33% | -0.09% | 0.40% | 0.61% | -0.33% | |
| JPY | 0.10% | 0.36% | 0.33% | 0.24% | 0.72% | 0.91% | 0.07% | |
| CAD | -0.15% | 0.12% | 0.09% | -0.24% | 0.48% | 0.69% | -0.26% | |
| AUD | -0.63% | -0.36% | -0.40% | -0.72% | -0.48% | 0.21% | -0.72% | |
| NZD | -0.83% | -0.57% | -0.61% | -0.91% | -0.69% | -0.21% | -0.96% | |
| CHF | 0.11% | 0.37% | 0.33% | -0.07% | 0.26% | 0.72% | 0.96% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
The Federal Reserve left the policy rate unchanged at 4.25%-4.5% following the March meeting, as expected. The revised Summary of Economic Projections (SEP), also known as the dot plot, showed that policymakers still project a total of 50 basis points (bps) reduction in rates in 2025. Although the US Dollar (USD) struggled to gather strength with the immediate reaction, it managed to find a foothold during Fed Chairman Jerome Powell’s press conference.
Powell reiterated that they will not be in a hurry to move on rate cuts, adding that they can maintain policy restraint for longer if the economy remains strong.
In the European morning on Thursday, the UK’s Office for National Statistics (ONS) reported that the ILO Unemployment Rate held steady at 4.4% in the three months to January, matching the market forecast. Other details of the jobs report showed that the Employment Change was up by 144,000 in this period. Finally, annual wage inflation, as measured by the changed in the Average Earnings Including Bonus, declined to 5.8% from 6.1%.
The BoE is forecast to maintain the bank rate at 4.5%. Since there will not be a press conference, investors could react to the vote split. In case the BoE leaves the rate unchanged but three or four policymakers vote in favor of a rate cut, Pound Sterling could come under selling pressure with the immediate reaction. On the other hand, a unanimous vote could have the opposite impact on the currency’s valuation, allowing GBP/USD to gain traction.
GBP/USD Technical Analysis
The Relative Strength Index on the 4-hour chart stays near 50 and GBP/USD’s last 4-hour candle closed slightly below the 20-period Simple Moving Average (SMA) and the mid-point of the ascending regression channel, reflecting a lack of buyer interest.
In case GBP/USD confirms 1.2970 (mid-point of the ascending channel) as resistance, technical sellers could remain interested. In this scenario, 1.2900 (round level, static level) could be seen as next support before 1.2850 (lower limit of the ascending channel, 100-period SMA).
On the upside, resistances could be seen at 1.3000 (static level, round level), 1.3040 (static level) and 1.3120 (upper limit of the ascending channel).
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