GBP/USD dropped as Fed Chair Jerome Powell hinted of raising the dot-plot to four hikes. The dollar went up and cable dropped. For the pound, the next big event is the speech by PM Theresa May on Friday. Can that lift the pound?
Here is their view, courtesy of eFXnews:
BTMU Research discusses GBP/USD outlook into Fridays’ remarks by Prime Minister Theresa May, as she is expected to provide more clarity on the government’s own plan for a comprehensive free trade agreement.
“It has been widely touted as a “three buckets approach” which would allow some sectors of the UK economy to remain more closely aligned to the EU, while other sectors would be allowed more room to diverge in the future. Further clarity on the UK government’s plans for future trading relations should be welcomed by economic agents and market participants. However, elevated implementation risk will ensure that the final destination for future trading relations remains uncertain.
In these circumstances, we doubt that the pound will receive much of a boost from Prime Minister May’s speech,” BTMU argues.
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