The 10-year yield on US government bonds rose to 1.50%, the highest level since June 26 in anticipation that the Fed will soon begin to tighten monetary policy, despite slower growth and the forecast for higher inflation for the year.
In addition, Fed Chairman Jerome Powell and US Treasury Secretary Janet Yellen will appear before the US Senate Banking Committee to discuss oversight of the Care Act (coronavirus aid and economic security). Powell said in his remarks that higher prices and hiring problems could linger longer than expected, but considered them transient.
On the other hand, the British pound rose after the speech of the Governor of the Bank of England (BOE) Andrew Bailey to the Society of Professional Economists, he warned that the rise in interest rates may come earlier than expected, despite the existing quantitative easing. Nevertheless, all profits have evaporated from long-standing concerns about Brexit. In a recent development, French Minister for European Affairs Clement Bonn said that the current energy crisis in Britain reflects the “intellectual fraud” that is Brexit.
For now, traders continue to focus on publishing the trade balance of goods in the United States and CB consumer confidence data to gain a new impetus to trade.
GBP / USD Chart:
Technically, the cable last day tried to break the resistance of 1.37184 but failed, closing the double spark plug below 1.3700, which is an indication that this week the bears are maintaining their pressure. The price would potentially move back to the lower limit of the 3-month range, where traders will closely monitor what happens to the price. On the other hand, if the daily candle breaks and closes above 1.3700 and the resistance is 1.37184, the price will go to its next barrier 1.3800, where it is located close to 50 SMA.