- The pound sterling fell to almost 1,3330 compared to the US dollar before the announcement of the Fed monetary policy.
- The Fed should have stable interest rates, while the BOE should reduce them on Thursday.
- US-Chinese trade discussions will be the key trigger for the global market.
The pound sterling (GBP) is negotiated with caution at almost 1.3370 against the US dollar (USD) during North American negotiation hours on Wednesday. THE GBP / USD pair faces a slight pressure, while the USD consolidates before Federal reserve (Fed) Announcement of monetary policy at 6:00 p.m. GMT, in which the central bank is almost sure to keep interest price Stable in the current beach of 4.25 to 4.50%.
It would be the third consecutive political meeting in which the Fed will leave stable borrowing rates in an uncertainty about the way in which new economic policies by UNITED STATES (United States) President Donald Trump will shape the economy. A series of Fed officials, including President Jerome Powell, have guided that “to wait and see” is an optimal approach until they are clarity on the quantity of new politicians influencing inflation and economic prospects.
The expectations of the inflation of American consumers have increased, the owners of local businesses, have said that they will pass on the impact of high importers with consumers, a convincing factor for the Fed to require more time before making monetary policy adjustments. In addition, constant employment growth in the wake of Trump's pricing policies is another limiting factor for the Fed to act prematurely by reducing interest rates.
Daily Digest Market Movers: Pound Sterling takes a break before the political meeting of the BOE
- The Sterling book takes a break Wednesday after a net movement movement the day before. The British currency remains largely firm against its peers, because the United Kingdom (United Kingdom) and the United States are about to sign a bilateral trade agreement.
- A Financial Times (FT) report showed Tuesday that the two countries are close to a trade agreement in which the United States will lower steel and British cars. In return, the United Kingdom would reduce prices on cars and agricultural products in the United States and would make changes to the digital services tax.
- In the future, the major trigger for the British currency will be the decision of monetary policy of the Bank of England (BOE), which will be announced on Thursday. BOE should reduce interest rates by 25 basic points (BPS) to 4.25%. It would be the fourth interest rate reduced by the BOE in the current monetary softening cycle, which began in August from last year.
- Investors will pay particular attention to the BOE advice on monetary policy and economic prospects. Market experts believe that the BO could guide an aggressive policy of politics following the American-Chinese trade war. Investors fear that China will move to other savings to sell its products. Given the low -cost competitive advantage of China, the competitiveness of other nations products would decrease if Beijing pushes more products on the world market.
- Meanwhile, the United States and China have agreed to exchange discussions this week. The American secretary of the Treasury, Scott Bessent and the commercial representative, Jamieson Greer, confirmed Tuesday that they would meet their Chinese counterparts for commercial discussions this week in Geneva. This will be the first confirmed meeting between the two largest powers in the world since the imposition of reciprocal prices and reprisals announced by the United States and China, respectively.
- Earlier this week, the American secretary Bessent pointed out that Washington would have commercial talks with Beijing earlier because these rate rates are not durable. A positive result of the commercial talks of American China will be favorable to risky assets around the world.
Technical analysis: Pound Sterling remains above 1,3300
The pound sterling clings to the gains of Tuesday about 1,1370 against the US dollar on Wednesday. The global prospects It remains optimistic because all short -to -short exponential movable mediums (EMAS) are sloping above.
The 14-day relative force index (RSI) endeavors to return above 60.00. A new bullish momentum would trigger if the RSI manages to do so.
Uplining, the 1.3445 three -year summit will be a key obstacle for the pair. Looking down, on April 3, approximately 1,3,200 will serve as a major domain of support.
