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30 Sep 2013
GBP/USD retraces from 1.6200
FXstreet.com (Edinburgh) -The sterling is now easing some ground against the greenback after pushing the GBP/USD to fresh 8-month highs around 1.6200 the figure.
GBP/USD eyes on PMI, US shutdown
The weakness surrounding the greenback is propelling the pair to the vicinity of the 1.6200 handle, levels last seen in January, and the trend looks set to continue as the shutdown of the US economy seems the most likely scenario in the very near term. In the UK economy, the most relevant releases will be tomorrow’s final manufacturing PMI result, with forecasts expecting the headline to improve a tad to 57.3 for September and Thursday’s services PMI, all preceding the US Payrolls on Friday. According to Paul Robson, FX Strategist at RBS, “Outflows of debt income have been rising fairly steadily. This will only get worse as 1) the BoE isn't buying anymore and 2) the fiscal deficit has stopped improving. This leaves us believing that the air above is thinning rapidly for GBP, most notably GBP/USD”. It is worth noting that RBS expects the pair to slide back to 1.55 by year-end, 1.52 in Q1’14 and 1.50 in Q2’14.
GBP/USD key levels
At the moment the pair is up 0.28% at 1.6184 with the next resistance at 1.6255 (high Jan.3). On the downside, a drop beyond 1.6025 (MA10d) would expose 1.5955 (low Sep.24) and then 1.5893 (low Sep.18).
GBP/USD eyes on PMI, US shutdown
The weakness surrounding the greenback is propelling the pair to the vicinity of the 1.6200 handle, levels last seen in January, and the trend looks set to continue as the shutdown of the US economy seems the most likely scenario in the very near term. In the UK economy, the most relevant releases will be tomorrow’s final manufacturing PMI result, with forecasts expecting the headline to improve a tad to 57.3 for September and Thursday’s services PMI, all preceding the US Payrolls on Friday. According to Paul Robson, FX Strategist at RBS, “Outflows of debt income have been rising fairly steadily. This will only get worse as 1) the BoE isn't buying anymore and 2) the fiscal deficit has stopped improving. This leaves us believing that the air above is thinning rapidly for GBP, most notably GBP/USD”. It is worth noting that RBS expects the pair to slide back to 1.55 by year-end, 1.52 in Q1’14 and 1.50 in Q2’14.
GBP/USD key levels
At the moment the pair is up 0.28% at 1.6184 with the next resistance at 1.6255 (high Jan.3). On the downside, a drop beyond 1.6025 (MA10d) would expose 1.5955 (low Sep.24) and then 1.5893 (low Sep.18).