- GBP/USD ticks up to test two-month highs at 1.3175.
- The pound on track to its best week in the last months.
- The post-elections risk rally sens the US dollar tumbling.
The pound sterling has ticked higher against a broadly weaker US dollar on Friday to reach the top of the last two months trading range, at 1.3175 which, so far, remains intact.
Pound consolidates its recovery against a weak USD
The sterling has remained trading sideways for most of the day, consolidating gains above 1.3100 after having rallied on Thursday, with the greenback on the back foot amid the post-US elections’ risk rally.
The market has welcomed the news from the US presidential election with equity markets surging this week as Joe Biden took the lead on key states, reaching close to the White House while the Republicans keep control of the Senate to block the Democrats’ large stimulus plan or any attempt to raise taxes.
The British pound is on course to a 1.5% advance this week, practically unaffected by the Bank of England’s monetary policy decision. The Bank announced a plan to ramp up its already huge asset purchases program by £150 billion on Thursday to offset the economic impact of the coronavirus lockdown.
On the macroeconomic front, the better than expected US Non-Farm Payrolls report, which has shown a 638K increase on employment in October, beating market expectations of a 600K rise, has failed to offer any relevant support to an ailing USD.
Technical levels to watch
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