GBPUSD Price Supported by MPC Rate Hike Musings, FOMC Ahead

STERLING (GBP) AND US DOLLAR (USD) TALKING POINTS AND CHART:

• One or two rate hikes per year assumes UK wage and productivity growth pick up.
• Unwinding QE need not impact UK yield curve if communicated correctly.
• Fed 0.25% interest rate hike fully priced-in for Wednesday.

MPC MEMBER VLIEGHE SAYS 1-2 UK RATE HIKES PER YEAR IS BROADLY CORRECT

GBPUSD got a small leg-up mid-morning when external MPC member Gertjan Vlieghesaid that 1-2 rate hikes per year would probably be needed if UK wage and productivity picked up. Previously seen as a dove on the MPC, Vlieghe was speaking at the Imperial College Business School on the yield curve and the effects of QE. Vlieghe also said that QE can be unwound – either by selling gilts or letting them roll-off - without pushing yields higher if it is communicated correctly by the Bank of England.

The Yield Curve and QE – Speech by Gertjan Vlieghe

GBPUSD perked up further post-commentary as the pair try to recover last week’s losses. With Brexit news still in charge of Sterling’s destiny, central bank talk is not as effective as it used to be, but today’s rate hike chatter still confirms that the UK will need to tighten monetary policy and maybe at a quicker rate than market pricing is signaling.

FOMC RATE HIKE AND NEW DOT PLOT

A look at the charts shows GBPUSD splitting the 20- and 50-day averages but still above the 200-day ma despite last week’s downturn. The recent uptrend has been broken and GBPUSD would have to trade and close above 1.3280 to resume this bullish trend. The pair may run into selling pressure when the FOMC releases its latest ‘dot plot’ on Wednesday at the FOMC press conference if the path of 2019 rate hikes is accelerated.

RECENT STERLING (GBP) ARTICLES:

GBPUSD Weekly Technical Outlook: Bullish Trend Broken

GBP: Bullish Sentiment Erased by Brexit Impasse

GBPUSD FOUR HOUR PRICE CHART (JULY 30 – SEPTEMBER 25, 2018)

Traders are 59.2% net-long GBPUSD but recent positional changes give us a mixed trading bias.



                           Start Trading with Free $30    : CLAIM NOW $30

               

VERIFY YOUR ACCOUNT AND GET YOUR $30 INSTANTLY ,MAKE MONEY WITHDRAW !!

               IT IS POSSIBLE TO SHIFT FROM $30  TO  $1,000,000  TRY  TODAY

IF  YOU  FACE  ANY  PROBLEM  TO  GET  THIS  OFFER  PLEASE CONTACT US FOR

SUPPORT ,  CLICK  SMS  BAR  ABOVE  THEN  TALK  TO  US.