The GBB/USD continued to decline during the previous week’s trading session after the dollar rallied on Wednesday after Fed Chair Janet Yellen indicated that the bank could begin to raise interest rates about six months after its bond-buying program winds up, which is expected to happen this fall.
The comments prompted investors to bring forward expectations for a rate hike to as early as March of next year.
The Fed also reduced its monthly bond purchases by an additional $10 billion to $55 billion at the conclusion of its two-day policy meeting, and said there was “underlying strength in the broader economy.”
Weekly bias on the pair remains on the downside as 21/55 EMA, Stochastic, RSI and MACD are signaling a continuation of the bearish trend. A break of support 1.64746 would see further decline to 1.63807 (78.4 Fibonacci retracement from 1.62515 to 1.68213).
Key economic indicators to watch out for this week are the Great Britain Pound CPI y/y and Retail Sales m/m.