GBP/USD Fundamental Analysis: October 10, 2017
The markets are generally dull yesterday in spite the Cable pair moved higher during the daytime trading session. Both Canada and the United States is a holiday and liquidity is expected to be low during the entire day, while Japan is a holiday as well. However, the bulls active in the pound market took advantage of the low liquidity in pushing the prices upwards.
Meanwhile, the British pound continues to struggle in the sluggish data causing the Bank of England to keep on hold in the near term. During the BoE’s meeting in the previous month, there are possibilities that the central bank would raise its rates in December this year, but the impact of political risks and weaker data prompt them to be on hold.
The Brexit process is excluded from the issues of political uncertainties rather the extension of the UK Prime Minister Theresa May from her position.
Currently, PM May is urging to resign even by her own party and it remains unclear how she will handle this issue as well as to maintain the focus on processing the Brexit referendum.
Moreover, there is a rising issue about the no-deal in the euro area which could negatively affect the Britain’s economy.
If these factors were combined, it could probably keep the GBP in the pressured area. For today, the UK manufacturing production data is scheduled to be released from the United States. When the liquidity became stable again, it is expected that the greenback will continue to decline but will support the GBP/USD pair to ascend.