GBP Shows Modest Gains, But Faces Resistance
The Pound Sterling (GBP) is currently performing decently among the major currencies, according to Scotiabank’s Chief FX Strategist Shaun Osborne.
Factors Influencing GBP Performance
- Bank of England (BoE) Deputy Governor Lombardelli’s recent cautious stance on easing rates due to consistent wage growth trends.
- Market expectations for BoE to maintain current rates in December and potentially ease in early 2025.
Despite a gap higher over the weekend, GBP’s upward movement is facing resistance around the 1.26 mark. The short-term resistance at 1.2610 is proving to be a challenge for further advancement. A possible drift back to the low 1.25s might be necessary to fill the overnight gap before GBP can push higher towards a minor relief rally at 1.27/1.28.
Analysis and Future Outlook
GBP’s performance is closely tied to the BoE’s monetary policy decisions and economic indicators. The cautious approach to rate adjustments indicates a measured response to current economic conditions. This could lead to a gradual easing cycle in the coming years, affecting GBP’s strength in the forex market.
Investors and traders should monitor BoE statements and economic data releases to gauge GBP’s future movements and make informed decisions regarding their portfolios.