Currency In focus – Great British Pound

BOE Policy, CPI numbers will drive the direction 

The British pound has been struggling since morning; however, the currency managed to stay strong against the dollar and Rupee. As the significant UK inflation data and Bank of England (BOE) policy are lined up Wednesday and Thursday, that could drive huge volume and volatility in days to come.

U.K May CPI number will be released on Wednesday, just ahead of BOE policy.  Data is expected to come at 8.4% slightly lower from the previous month’s reading of 8.7%. The data could confirm that inflation in the U.K. remains more than four times above the central bank’s 2% medium-term target

On the same day, Fed Chair Jerome Powell’s testimony is due. Powell will testify about the Semi-Annual Monetary Policy Report before the House Financial Services Committee.

On Thursday, the Bank of England policy meeting will take place.  The Bank of England will likely announce a 25 bps rate hike, 4.75% from 4.5% as widely expected, on Thursday. However, the central bank’s outlook on interest rates will be key for the Pound Sterling. It’s not a ‘Super Thursday’; therefore, there will be no press conference from BoE Governor Andrew Bailey

Technical Outlook – GBPUSD

Since 29 May 2023, GBPUSD has been trading in a strong bullish zone. Pair gained almost 4% from the bottom 1.22984 to a recent high of 1.28194. Now it’s trading at 1.2794, up by 0.31%.

On the above chart, the pair is trading above its crucial support and forming a higher high candlestick, which is yet indicating a bullish momentum in the near future. It is expected that the GBPUSD pair could test next resistance 1.2840-12885.00 very soon.

On the downside, immediate support is seen at 1.2720-12685.00

GBPINR Technical

GBPINR spot pair has been trading in a bullish trend since 06 March 2023. The pair gained more than 5% in the last three months. After posting minor losses in the previous session, now the pair is trading at 105.983, up 0.20%.

On the above chart, the pair is forming a bullish continuation trend. Now, the pair will expect to extend its recent gain and could test a new multi-week high. That would be around 106.55-107.20. On the downside, immediate support is seen at 104.48-103.90