The British monthly GDP is announced on Friday at 09:00 MT time.
Will the GBP advance on a strong BOE policy?
The Bank of England gives the interest rate press conference on Thursday at 14:00 MT time.
Instruments to trade: EUR/GBP, GBP/USD, GBP/CAD, GBP/CHF
The last activity from the side of the Bank of England was a unanimous vote to keep the rate unchanged at 0.1% after it was reduced twice in March to respond to the virus damage. The policymakers expressed their commitment to support the economy and maintain a possibly favorable financial climate in the UK. The latter has been fortified by an extensive policy of quantitative easing the Bank has been implementing. Nevertheless, similar to other countries, an increase in unemployment is expected in line with economic damage in the nearest future. Coupled with Brexit, this period promises to be one of the toughest challenges for the British economy and the Bank of England. We will be looking into the details and subtle messages about the economic outlook in the report of the Bank of England’s policymakers while the rate is expected to stay steady.
- If the bank’s message is optimistic, the GBP will rise.
- If the bank’s message is not very optimistic, the GBP will fall.
The main market tendency today is that the US dollar is rising against its major peers and riskier assets such as stocks and oil are plummeting.
The USD continues dipping, while the GBP is rising on hopes for the Brexit deal done today.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.