Pound Sterling Declines as Likelihood of BoE Rate Cut Rises

Fundamental Analysis

* Rising Odds: The British pound has continued to decline, hitting a ten-week low as dovish sentiment and growing expectations of a Bank of England (BoE) rate cut in November put pressure on the currency. Falling consumer and producer inflation figures, along with weak labor market data in the UK, are driving forecasts that the BoE may reduce rates by 25 basis points next month, with another quarter-point cut potentially following in December. BoE Governor Andrew Bailey recently emphasized the need for the central bank to improve its oversight of the less transparent non-banking sector.

Technical Analysis

* Technical Breakout: Recent breakout below the previous support level 1.29400 with MACD illustrates ongoing bearish momentum suggest the pair to likely further extend its losses.

*Resistance and Support: If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards the level 1.27900. Conversely, a potential reversal is also to be expected and the price could head back towards 1.30900 after it breach back above 1.29400.

Understand how technical analysis can help you in this trading opportunity.

Potential Risks

Looking ahead, PMI data from the UK and the US will be released on a rolling basis throughout Thursday, while investors will also be watching for a series of speeches from central bankers from both the Bank of England (BoE) and the Federal Reserve (Fed).

Know how to manage trading risks with risk management strategies.

Monitoring

Stay updated on US and UK data, central bank updates and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

Grab the trading opportunity and dive into the action risk-free with a free demo account. It is the perfect way to hone your skills and explore the exciting world of trading!

Open Your Free Demo Account And Start Trading Risk-Free

Join Now

Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.