During the past trading week, the British pound to US dollar exchange rate (GBP/USD) has undergone a variety of influences. From the United Kingdom budget to the Federal Reserve, the currency has experienced a wide variety of factors that have caused it to drop in value. The pair is currently trading between horizontal support and resistance levels. In order to determine the direction of the price movement, traders should analyze the chart of the pair.
The Bank of England raised interest rates for the sixth consecutive time this month. Governor Andrew Bailey said that policymakers are “prepared to adjust interest rates further” if necessary to support the economy. This month’s report is expected to show a small increase in UK headline inflation. Despite the increase in the inflation rate, the rate of economic growth is slowing down. This could have an adverse impact on the jobs market in the U.K.
The cost of living crisis is also a major concern for many Britons. This dubbed the worst cost of living crisis in a generation. The UK has seen soaring inflation driven by rising energy prices and food prices. This pressure on the Bank of England to raise interest rates increases. This has created a tug of war between the Treasury and the central bank.
The UK economy is still strong, but growth is slowing down. This has created a situation where the government is borrowing money to fund tax cuts and to kickstart the economy. The Truss government has gambled on borrowing to pay for tax cuts in order to kickstart the economy. The result is a budget gap of around GBP35bn.
GBP/USD is one of the most liquid currencies in the Forex market. This means that the pair is highly volatile. The spread between the two currencies is usually around one pip to three pip. This means that a trader will need to be careful when making decisions. In addition, the currency is heavily influenced by news flow. If a new economic report comes out, the value of the currency can rise or fall dramatically.
In addition to the economic data, the British pound is also affected by political factors. Changes in political parties and government elections can cause huge movements in currencies. This means that investors should pay close attention to the news that comes out of the U.K. The pound is also influenced by local financial news.
The British pound has been rising steadily since September, but its gains have been relatively small. The pound is down 15% against the US dollar since the beginning of the year. There is some uncertainty about the future of the UK, including a possible hard Brexit. This uncertainty could put further pressure on the pound.
Despite these concerns, the British pound is attempting to rebound against the dollar. The pound recently broke through a key resistance at the level of 1.1280. This could be the first step in breaking through the 1.1600 mark. Several economists are forecasting that the pound could reach parity with the dollar.