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19 Aug 2013
Flash: GBP/USD upside showing signs of exhaustion? – Investec
FXstreet.com (New York) - The major factor that will threaten the recent rally in the GBP/USD is the re-emergence of markets focus on the likelihood of the Fed tapering and this week could spark that interest, notes Jonathan Pryor, Corporate Treasurer at Investec.
Key quotes
“The latest FOMC minutes from the US will be released on Wednesday evening and could shed some light on September tapering. Investors have grown wary of the promise of Fed tapering as the summer has progressed but it’s difficult to ignore the impact this theme had on the GBP/USD in June (dipping to the 1.48’s) and therefore we will remain vigilant to the possibility of renewed USD strength.”
“It’s interesting to note an article released in the Wall Street Journal today that discusses the possible fractions created in the Fed by Bernanke’s planned departure and the arrival of his successor. Long-term, any Fed instability that threatens the credibility of their policy approach will be viewed as dollar negative by markets.”
“Elsewhere, it remains quiet in Europe so we look ahead to any revision to the final German Q2 GDP estimate released this Friday for potential impact on the single currency, whilst we keep one eye on Egypt as the appalling violence continues in the region which is yet to have any significant affect on markets.”
Key quotes
“The latest FOMC minutes from the US will be released on Wednesday evening and could shed some light on September tapering. Investors have grown wary of the promise of Fed tapering as the summer has progressed but it’s difficult to ignore the impact this theme had on the GBP/USD in June (dipping to the 1.48’s) and therefore we will remain vigilant to the possibility of renewed USD strength.”
“It’s interesting to note an article released in the Wall Street Journal today that discusses the possible fractions created in the Fed by Bernanke’s planned departure and the arrival of his successor. Long-term, any Fed instability that threatens the credibility of their policy approach will be viewed as dollar negative by markets.”
“Elsewhere, it remains quiet in Europe so we look ahead to any revision to the final German Q2 GDP estimate released this Friday for potential impact on the single currency, whilst we keep one eye on Egypt as the appalling violence continues in the region which is yet to have any significant affect on markets.”