super-thursdayAfter Wednesday’s conclusion of the FOMC meeting that failed the expectations of investors, Session 2 February brings “Super Tuesday,” a series of important publications of the Bank of England – already at 13:00 will be announced decision on interest rates, monetary policy statement, the minutes of the meeting and updated inflation report. Be aware that pound sterling can strongly move!


What we know and what are we waiting for? Calendar for Thursday

But before we proceed to a more detailed discussion of scenarios before BoE meeting summary, let’s look at the data that appeared in the calendar and to those which will appear. At night, about 0:30 GMT our time Australia shared the results of export-import. The trade balance turned out to be more than one billion US dollars higher than the assumed markets.

NZD/USD D1 – quotations were between the proverbial rock and a hard place. On the one hand effectively tests today once again the support area 61.8% Fibo + 0.7237 from the trend line and the second consecutive elimination level block further increases. Only breaking out from this restrictive formation can answer what’s next

As for the macroeconomic calendar ahead of the BoE is worth paying attention to retail sales in Switzerland for December and PMI construction sector in the UK. At the start of the US session only some average major publications such as jobless claims, non-agricultural productivity or unit labor costs.

Bank of England unchanged, but GDP forecasts upwards

The consensus among analysts of largest investment banks ahead of the BoE is very similar – Mark Carney and the company does not present any significant changes in monetary policy, rhetoric, however, may take slightly hawkish, and forecasts for GDP will again be revised upwards.

According to Morgan Stanley, GBP/USD can reach levels of 1.27-1.28 before the end correction of the release, and realization of profits, and then return to the fundamental downward trend, which inter alia is due to the strong divergence of monetary policy in the US.

GBP/USD D1 – quotations of cable are already 5 months in a wide, 800-pip consolidation. Its glass ceiling continues to be a zone of 1.2700-1.2800, which effectively block further increases. Re-test that level from the bottom can be an ideal opportunity to open short positions

Given the good performance of the British economy in the fourth quarter, the Bank of England is likely to adjust their forecasts of GDP – on the other hand can, however, express concerns about the strength and durability of indices of consumer prices, especially in the face of high household debt. At the same time, inflation projections remain on rather constant level.

In the short term GBP may thus gain after the meeting, in a longer perspective, however, will continue to lose. At 12:30 also is scheduled a press conference M. Carney.

GBP/USD D1 – quotations of cable are already 5 months in a wide, 800-pip consolidation. Its glass ceiling continues to be a zone of 1.2700-1.2800, which effectively block further increases. Re-test that level from the bottom can be an ideal opportunity to open short positions

Dollar with the worst start in the new year for decades

At the end as a interesting fact a graph showing the January moves of US dollar in historical perspective. 2017 year brings so far the worst results since the 1987, when Ronald Reagan caused a depreciation of the currency in order to fight the flood of Japanese imports:

Strong slides in the coming years, however, brought strong increases. I wonder how the situation will develop by the time of presidency of the popular billionaire.

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