The Pound is slowly falling. Overview for 12.01.2021
GBPUSD is slowly falling being pressured by the USD and Brexit.
The British Pound is slightly retreating against the USD, thus building a new descending tendency. the current quote for the instrument is 1.3530.
On January 4th, the Pound “touched” the high at 1.3704, and then bears took charge.
Yes, the British currency is currently “suffering” from the USD strengthening. A positive effect of the Brexit deal made at the very end of 2020 by the United Kingdom and the European Union has been slowly fading away and may be replaced by concerns and carefulness. In addition to that, investors are worried about the possibility of implementation of negative interest rates by the Bank of England and that’s another risk that puts pressure on the Pound.
The fact that the United Kingdom may introduce more serious quarantine restrictions because of the coronavirus pandemic, means that the 1st quarter of 2021 may face a more significant slump than before. It’s a serious factor that puts much pressure on the British regulator’s stance – the BoE doesn’t want but has to consider different options, including the further loosening of its monetary policy as early as during the February meeting.
CFTC says that the bullish tendency in the Pound hasn’t been very strong for the fifth week in a row. It means that market players are very concerned about the Pound outlook and don’t expect it to grow in the nearest future.