- GBP/USD demonstrates the weakest performance out of all the major currency pairs.
- GBP pressured by prospects of monetary easing measures from the BOE.
- Brexit and coronavirus still weighing heavily on the GBP/USD performance.
The GBP/USD kicked off Friday morning’s trading session on a weak bullish performance, and this subdued performance is mainly due to speculation that the Bank of England will roll out economic easing measures. Numerous BOE members brought up the conversation using unconventional monetary easing policies during a meeting held a week ago. This has prevented the GBP/USD exchange rate from achieving its rally potential this week.
The GBP/USD exchange rate demonstrated some upside potential on Friday morning, but it looks like the pair was held back due to the monetary easing speculation. The pair is expected to test the 1.2341, 1.2386, and 1.2419 if it trades long above the 1.2321 price level during the trading session.
The U.S is scheduled to release its weekly unemployment data and GDP figures on Friday afternoon, which may have some impact on the performance of the currency pair. However, it will depend on whether the data will favorable or not for the U.S dollar.
It is perhaps best to look at the GBP/USD’s performance influences over the past few weeks to determine whether a strong rally will be forthcoming in the next few weeks. Various factors have hard hit the Pound over the past 11 weeks. They include expectations of negative interest rates, Brexit talks, escalating debt, and economic recession.
The economic situation is expected to start recovering once the world has a handle on the coronavirus spread. As far as the Brexit talks appear to lack direction, but on the positive side of things, the BOE has been carefully monitoring the economic situations so that it can ensure the right decisions that will favor the British economy. Favorable economic data may help boost the Pound’s position.