empty
 
 
22.06.2018 09:31 AM
Global macro overview for 22/06/2018

Global macro overview for 22/06/2018:

The Bank of England leaves the rates unchanged, but pressure to hike increases.

The key interest rate of the Bank of England was maintained at 0.5% in line with expectations. It is a surprise, however, that Haldane joins McCafferty and Saunders and vote for a 25 bp increase, so Haldane joined the "full-time BoE hawks". The statement said that "most MPC members think that the weakness of the first quarter was transitory, but it prefers to wait for more data from the economy". Haldane's voice is the main source of surprise as it strengthens market speculation about another hike at the next meeting in August.

The Bank of England in the statement after the decision changed the attitude regarding the asset purchase program. The bank assumes that it will not start reducing the portfolio of bonds purchased under QE until the interest rate reaches 1.5%. Previously, the condition was to raise the interest rate to 2%, so this change has another hawkish tone.

In conclusion, the change of point of view of BoE together with Saunder change of point of view from dovish to hawkish will all lead to further appreciation of British Pound across the board. The global investors wil now anticipate a rate hike rather sooner than later, possibly even at the next BoE meeting.

Let's now take a look at the GBP/USD technical picture at the H4 time frame. The market reaction is clearly bullish as a massive up candle is clearly visible at the H4 time frame as the market broke out of the Falling Wedge pattern. Currently, the price is testing the technical resistance at the level of 1.3292 - 1.3307 zone and the momentum is clearly pointing to the north. Any violation of this resistance zone will lead to another spike higher towards the level of 1.3340 - 1.3350. The immediate support is seen at the level of 1.3270.

This image is no longer relevant

Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and get $8000 more!
    In March we raffle $8000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST
  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS

Recommended Stories

Can't speak right now?
Ask your question in the chat.
Widget callback