- Mortgage approvals rise to a 9-month high in the U.K. as markets await a BoE rate hike.
- New home sales fall 5.3% in the United States.
- US Dollar Index stays calm near mid-94s as investors step aside ahead of Trump-Juncker meeting.
The GBP/USD pair rose to 1.3180 during the European trading hours following the data releases from the UK but returned to its opening levels near 1.3150 during the NA session. At the moment, the pair was up 5 pips on the day at 1.3149.
The data released by the British Bankers Association showed that the total amount of mortgage approvals rose to its highest level in nine months at 40.541K in June from 39.528K in May as owners started to remortgage their houses in anticipation of a BoE rate hike. Furthermore, CBI distributive trades survey in July eased to 20% from 32% but still came in above the market expectation of 15%.
In the second half of the day, the subdued trading action couldn’t force the US Dollar Index to push lower as investors refrain from taking large positions ahead of the critical meeting with the US President Donald Trump and the EC President Juncker. Today’s data from the U.S. showed that new home sales dropped by 5.3% in June following May’s 3.9% increase but failed to put additional pressure on the greenback as investors were already waiting a negative number after the sharp fall seen in existing home sales numbers on Monday.
There won’t be any macroeconomic data releases from the UK on Thursday and investors will be focused on trade balance and durable goods orders data from the U.S..
Technical outlook
The initial resistance for the pair aligns at 1.3180 (daily high/20-DMA) ahead of 1.3240 (50-DMA) and 1.3290/1.3300 (Jul. 16 high/psychological level). On the downside, supports could be seen at 1.3070 (Jul. 24 low), 1.3000 (psychological level) and 1.2955 (Jul. 19 low).
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