GBP/USD is almost unchanged in the Monday session. In North American trade, the pair is trading at 1.3228, up 0.14% on the day. It’s a quiet session for fundamentals, with no data events. In the U.S., the sole events are speeches from two FOMC members, Charles Evans and Eric Rosengren. On Tuesday, the U.S. releases building permits and CB consumer confidence.
Amid the chaos surrounding Brexit, about the only certainty in store this week is that the drama will continue, as parliament is scheduled to hold a series of votes. On Monday, lawmakers vote on whether to adopt alternatives to Prime Minister May’s withdrawal agreement. If this motion passes, parliament would vote on an array of alternatives on Wednesday, which could include a second referendum or some version of May’s withdrawal deal. However, even if any alternatives are supported by parliament, they would not be binding on the government. May has seen her authority seriously eroded, and she would like nothing more than to see parliament pass her deal or a similar variation. The pound showed strong movement late in the week, and the volatility is likely to continue this week.
A sharply dovish Federal Reserve has unnerved investors, and stock markets dropped sharply late last week. At last week’s policy meeting, the Federal Reserve indicated it had no plans to raise interest rates in 2019 and also lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. There was more bad news on Friday, as the spread between 3-month and 10-year Treasury notes turned negative for the first time since 2007. This is known as an inverted yield curve, which is considered a recession indicator. All eyes will be on U.S. Final GDP, which will be released on Thursday. If GDP is weaker than expected, traders can expect volatility in the currency markets.
Monday (March 25)
- 2:00 US FOMC Member Evans Speaks
- 20:30 US FOMC Member Rosengren Speaks
Tuesday (March 26)
- 8:30 US Building Permits. Estimate 1.32M
- 10:00 US CB Consumer Confidence. Estimate 132.1
*All release times are DST
*Key events are in bold
GBP/USD for Monday, March 25, 2019
GBP/USD March 25 at 11:30 DST
Open: 1.3210 High: 1.3247 Low: 1.3160 Close: 1.3228
GBP/USD posted small losses in the Asian session. The pair reversed directions in European trade and edged higher. GBP/USD is unchanged in North American trade but is showing stronger movement
- 1.3170 is providing support
- 1.3258 is the next resistance line
- Current range: 1.3170 to 1.3258
Further levels in both directions:
- Below: 1.3170, 1.3070, 1.2910 and 1.2841
- Above: 1.3258, 1.3362 and 1.3460
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