Forex, News, Price Analysis

GBP/USD Prediction: Ascending Channel Emerges Ahead of BOE Financial Decision

Briefly

  • GBP/USD has seen amplified bullish trends lately.
  • Focus moves to the upcoming BOE decision.
  • Analysts expect a 0.5% interest rate surge from the Bank of England.

GBP/USD price noted uptrends today (Wednesday) as market players concentrated on the upcoming rate decision by BOE (Bank of England). Meanwhile, the pair climbed to 1.2200, slightly beyond this week’s low at 1.2132.

Bank of England Rate Decision

GBP-USD stayed somewhat calm today as the market focus changed to the coming Bank of England rate move. Financial experts expect another massive interest surge from the central bank, citing surging inflation. They anticipate BOE to introduce a 0.50% hike, the highest from the bank since 2004.

The central bank has adopted a more hawkish stance, citing the soaring inflation. Last month’s data showed that inflation climbed to 9.4%, levels never seen in over three decades. Other figures have revealed a mixed outlook for the United Kingdom economy.

For instance, the unemployment rate stayed at 3.7% the previous month amidst tightened labor market. Moreover, consumer confidence and retail sales plunged drastically.

Consequently, according to IMF (International Monetary Fund), the United Kingdom will experience the slowest economic recovery among the G7s come 2023. Thus, there’re concerns about how high the central bank will increase rates.

Meanwhile, the housing industry continued to deteriorate over the last few months. Nationwide data revealed that house prices noted slight declines in July. In another report, the leading housebuilding firm Taylor Wimpey showed demand is still high while it increased its earnings projections.

The GBP-USD price will next respond to Friday’s US NFT (non-farm payrolls) figures. Experts expect the labor market to have slowed briefly in July.

GBP/USD Prediction

The 4hr chart shows GBP-USD price maintained massive bullishness over the last few days. Moreover, the pair has printed an ascending channel. Also, GBP/USD stayed beyond the 25- and 50-day MA while inside the ascending channel.

Thus, the FX pair might keep surging, with investors targeting the crucial 1.2333 resistance. However, it will likely drop after the Bank of England rate decision as market players sell the fact.

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