The Great Britain Pound rallied against the greenback in today’s trading session as uncertainty over when interest rates will rise in the U.S lingered on the mind of investors. The Federal Reserve on Wednesday left benchmark interest rates unchanged at 0.00-0.25% and cut its monthly bond-buying program to $35 billion from $45 billion in a widely expected move. The greenback weakened after the Fed didn’t hint at how much time will elapse after its monthly stimulus program concludes and when interest-rate hikes begin, with investors concluding that the Fed will take its time to tighten policy.
Meanwhile in the U.K, retail sales decreased by 0.5% last month, in line with economist expectations, official data showed, and were 3.9% higher on a year-over-year basis. The data did little to alter expectations that the Bank of England will raise interest rates sooner than other central banks. Also, U.K CBI Industrial Order Expectations improved from 0 to 11, beating economist expectation of 3. This also contributed to the strength in the Pound against all its rivals.
Intra-day bias remains on the upside as 21 and 55 EMA’s are crossed to the upside on the 1 hour, 4 hours and daily time-frames respectively. Moreover MACD and SSRC oscillators are also signalling bullish continuation, however i suggest caution as the trading week comes to an end so i am expecting a mild demand of the pair. Also price was able to break 1.69948 resistance, the highest the pair made this year but still testing August 2009’s high 1.70430 which happens to be a resistance, a clear break of such resistance would resume strong demand of d pair.
On Friday, the U.K. is to release data on public-sector net borrowing.