GBP/USD dropped 150 points last week. The pair closed at 1.2965. This week’s highlight is Preliminary GDP. Here is an outlook for the highlights of this week and an updated technical analysis for GBP/USD.
The pound dropped sharply after British CPI slowed down to 2.6%, short of the estimate of 2.9%. In the US, political risk continues to rise, as Trump’s failure to pass a healthcare bill triggered a fresh wave of US dollar selling. The revelation that Special Counsel Mueller is expanding his investigation into Trump’s business dealings also contributed to the greenback’s losses.
Updates:
GBP/USD graph with support and resistance lines on it. Click to enlarge:
CBI Industrial Order Expectations: Tuesday, 10:00. The manufacturing sector has been improving, as the indicator surged to 16 in June, crushing the estimate of 7 points. The estimate for July stands at 12 points.
MPC Member Andy Haldane Speaks: Tuesday, 17:00. Haldane will deliver a lecture at the Finance Foundation in London. Remarks which are more hawkish than expected is bullish for the British pound.
Nationwide HPI: Wednesday, 26th-31st. This indicator is a gauge of the strength of the housing sector. After three straight declines, the indicator posted a strong gain of 1.1% in June, easily beating the estimate of 0.1%. Will we see another gain in the July release?
Preliminary GDP: Wednesday, 8:30. This is the key event of the week. The economy slowed down in the first quarter, with a gain of 0.3%. This missed the estimate of 0.4%. The markets are expecting another gain of 0.3%, and if the reading is softer than expected, the pound could react with losses.
CBI Realized Sales: Thursday, 10:00. Retail and wholesale sales jumped to 12 in June, crushing the estimate of 4 points. Little change is expected in July, with an estimate of 11 points.
GfK Consumer Confidence: Thursday, 23:01. The British consumer remains pessimistic, and the indicator dropped to -10 points in June, its lowest reading since July 2016. The estimate for July is -11 points.
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