Pound Climbs On Fed Optimism
November 06 2023 - 2:30AM
RTTF2
The pound advanced against its major counterparts in the
European session on Monday, on optimism the Federal Reserve has
finished raising interest rates.
Weak U.S. jobs and service sector activity data released on
Friday reinforced expectations that the Fed may not hike interest
rates any further. Futures markets currently imply an 86 percent
chance the first policy easing would come as soon as June.
Markets also expect the European Central Bank to cut rates by
April, and the Bank of England in August.
Oil prices rose as top exporters Saudi Arabia and Russia said
they would continue with oil supply curbs of more than 1 million
barrels a day through year-end.
The U.S. economic calendar is relatively quiet this week, with
reports on initial jobless claims, the U.S. trade deficit and
consumer sentiment along with remarks by Fed Chair Jerome Powell
awaited.
The pound appreciated to near a 2-month high of 1.2426 against
the greenback and more than a 4-week high of 1.1144 against the
franc, off its early lows of 1.2362 and 1.1096, respectively. The
pound is seen facing resistance around 1.27 against the greenback
and 1.13 against the franc.
The pound moved up to more than a 2-month high of 185.91 against
the yen and near a 3-week high of 0.8650 against the euro, from its
previous lows of 184.67 and 0.8676, respectively. The pound is
likely to face resistance around 188.00 against the yen and 0.84
against the euro.
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