GBP/USD has been edging higher as markets eagerly await the Federal Reserve. According to FXstreet’s Analyst Yohay Elam, sterling volatility is set to explode in response to Fed fireworks.
Key quotes
“The Fed is set to leave its policy unchanged but releases all-important growth, employment, inflation, and interest rate forecasts. Markets are penciling in the rise rate hike to come in late 2022 compared to only four out of 17 FOMC members foreseeing an increase during 2023. That is set to change now, and the question is by how much.”
“Jerome Powell, Chairman of the Federal Reserve, will meet the press and will also try to walk a fine line between higher prospects for expansion to fears of inflation. A balanced message would likely keep stock markets happy while bond yields continue rising, yet at a controlled pace, only nudging the dollar higher.”
“Some resistance awaits at 1.3930, the daily high. It is followed by 1.3950, a cap from early this week.”
“Support awaits at 1.3850, which provided support last week, followed by 1.310, the weekly low.”
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