GBP/USD sidelined near 1.2850 ahead of PM May-Tories meeting

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  • Tories might again rebel against the PM May if she fails to outline her departure date.
  • US economic data and present Brexit doubts could weigh on the pair.

The GBP/USD pair is little changed near 1.2850 while heading into the London open on Thursday. 

The British Pound (GBP) recovered from a three-month low during early-day trading as investors expect the UK PM Theresa May’s Brexit plan to get through parliament in its fourth attempt. The reason being brighter chances of the opposition Labour party’s abstain from voting.

Adding to the quote’s upside could the US Dollar (USD) weakness due to the latest news reports concerning the US executive order for foreign telecommunication companies and tensions surrounding the US-Iran relations.

Investors now look forward to PM May’s meeting with the Tories of the backbench 1922 committee. Even after announcing her readiness to present Brexit plan for a vote in the week starting from June 03, some Tory rebels are still searching for ways to topple the UK PM.

During last month, conservatives turned down the proposal to change party rules that could challenge PM May’s leadership as she offered to step down once Brexit is complete.

As a result, she is now forced to convey a final date to her departure, failure to do so can renew threats to PM May’s position.

There doesn’t seem anything important on the UK economic calendar but the US housing market data, manufacturing gauge and weekly jobless claims could offer intermediate moves.

The US housing starts for April might increase to 1.205 million from 1.139 million whereas building permits could rise to 1.298 million versus upwardly revised 1.288 million prior. Further, the current month’s Philadelphia Fed manufacturing survey could signal 9.0 mark against 8.5 and initial jobless claims for the week ended on May 10 may decline to 220K from 228K.

Technical Analysis

February month low near 1.2775 and 1.2700 seem nearby supports for the pair with April bottom around 1.2865 acts as immediate resistance which if broken could recall 1.2930 and 200-day simple moving average (SMA) level of 1.2960 during further increase.

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