GBP/USD: Fed also cut pound’s wings

GBP/USD has been unable to rise after the US central bank cut rates. Speculation about a rate reduction by the BOE, US politics, and US data are all eyed, in the opinion of Yohay Elam from FXStreet.

Key quotes

“Prime Minister Boris Johnson said that dealing with coronavirus is the top priority and he is unlikely to push any punches. The number of cases is rising, yet the UK is not one of the world's hot spots.” 

“Uncertainty is stemming from talks about future EU-UK relations post-Brexit. While negotiators are not shaking hands – due to coronavirus contagion fears – the discussions continue. Investors seem to assess that both sides are first tackling the easier aspects and not the most contentious ones.”

“Last but not least, the greenback is able to recover as Joe Biden is leading against rival Bernie Sanders in the Democratic Party's ’Super Tuesday’ primaries.”

“Final UK Services PMI is unlikely to change the picture of moderate growth in Britain's largest sector. The parallel US release is of higher importance with the ISM Non-Manufacturing PMI forecast to remain above 50, indicating ongoing expansion.”

“Another significant release is ADP's private-sector jobs report for February. An increase of 170,000 positions is on the cards after a leap of 291,000 in January.”