Knowledge launched on Wednesday morning by the UK Workplace for Nationwide Statistics means that inflation has not but been introduced underneath management, they usually left little doubt that the Financial institution of England will elevate rates of interest once more by 25 bp at its assembly on Thursday, as much as 4.75%.

Recent information on inflation, which elevated expectations relating to tomorrow’s outcomes of the assembly of the Financial institution of England, had a destructive stress on the pound.

Most economists consider that the Financial institution of England will proceed to boost rates of interest to a minimum of 5.5% (at the moment 4.50%). Market contributors and economists need to obtain affirmation of their expectations from the management of the British Central Financial institution tomorrow, and the more durable the accompanying statements are, the stronger the market and the pound will react to them.

On this regard, we nonetheless hope for the hawkish rhetoric of the accompanying statements from the financial institution’s administration and for the strengthening of the pound and the expansion of the GBP/USD pair after tomorrow’s assembly of the Financial institution of England.

This can give the pound extra bullish momentum and permit the GBP/USD pair to lastly break via the resistance zone close to the important thing stage 1.2800 in an effort to get away into the long-term bull market zone (for extra particulars and another situation, see GBP/USD: dynamics eventualities for 06/21/2023).

Nonetheless, if the US greenback permits it, i.e. if it resumes its decline. On this regard, market contributors will obtain new info on this matter: in the present day and tomorrow, Fed Chairman Jerome Powell will converse in Congress, together with highlighting the prospects for the financial coverage of the US Central Financial institution (for extra particulars on the dynamics of the greenback and market expectations, see in the present day’s evaluation “Greenback: Consumers are ready for brand spanking new drivers”).

In another situation, GBP/USD will resume development. A confirmed breakdown of the important thing long-term resistance ranges 1.2800 and 1.2848 will convey the pair into the zone of a long-term bull market, directing it in the direction of the higher border of the rising channel on the weekly chart and in the direction of the strategic resistance stage 1.4335, which separates the worldwide GBP/USD bear market from the bull market.