GBP/USD Current price: 1.3932
- BOE kept its monetary policy unchanged, hinted at “modest” tightening.
- Policymakers foresee temporary higher inflation up to 4% YoY.
- GBP/USD is neutral-to-bullish, sellers await around 1.4000.
The GBP/USD pair regained the 1.3900 level, currently trading at around 1.3930, the pound was little moved by the Bank of England that announced its decision on monetary policy. As widely anticipated, the central bank left its benchmark rate unchanged at 0.1%, and facilities programs were also on hold. Policymakers forecast inflation could rise to 4% in the last quarter of the year but added it would prove temporary. They indicated that “some modest tightening of monetary policy is likely to be necessary” over the next couple of years.
The pair seesawed between gains and losses after the BOE, gaining most ground during the American session amid a better market’s mood. The UK won’t publish macroeconomic data on Friday. Meanwhile, the country is reporting roughly 30,000 new coronavirus cases per day, although there’s no pressure on the health system while the number of deaths is reduced.
GBP/USD short-term technical outlook
The GBP/USD pair is neutral-to-bullish in the near-term. The 4-hour chart shows that technical indicators lack directional strength and remain stuck around their midlines. At the same time, the pair is developing above all of its moving averages, which anyway remain flat, with the 20 SMA providing dynamic support around the 1.3900 level. The bullish potential is limited as sellers will likely continue to defend the 1.4000 threshold.
Support levels: 1.3900 1.3865 1.3820
Resistance levels: 1.3960 1.4000 1.4045
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