The GBP/USD currency pair rallied higher today after Queen Elizabeth‘s speech at the Mansion House during the opening of the UK parliament. The currency pair was also boosted by comments from the Bank of England‘s Chief Economist, Andrew Haldane, who outlined a hawkish view regarding future rate hikes.
The currency pair gained over 110 points after the Queen’s and Haldane’s comments, which reversed the selling pressure that had engulfed the cable since the opening of today’s session. The currency pair had retraced some of its gains at the time of writing.
The cable opened today’s session under intense selling pressure and dropped to its lowest level since April 18 when Theresa May announced the UK general election. However, Queen Elizabeth’s speech reversed the downward trend as she noted that the new government’s priority would be to get the best Brexit deal for the country. Andy Haldane’s speech also boosted the pair’s performance as it raised the expectations for a rate hike, which had been downplayed by Mark Carney on Tuesday.
The cable’s rally was largely triggered by the queen’s speech as the macro data released from the UK docket had minimal impact on the cable’s performance. The UK’s public sector net borrowing released by the Office for National Statistics came in at £6.0 billion versus the expected £7.2 billion, hence, beating expectations.
The release of the UK’s CBI trends total orders and the US continuing claims data, both scheduled for tomorrow, are likely to influence the cable’s future performance.
The GBP/USD was trading at 1.2667 as at 15:05 GMT having dropped from a high of 1.2711. The GBP/JPY was trading at 141.24 having risen from a low of 139.81 earlier today.
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