GBP/USD Steadies After Monday’s Slump, Mr Bailey’s Comments


Governor Bailey Growth Warning

The governor of the Bank of England (BoE) expects "growth and demand to slow" due to the shock from energy prices this year, which "will be larger than any single year in the 1970s", as per his Bruguel speech on Monday. [1]

The BoE had delivered its third rate hike in a row earlier in the month in the face of surging inflation, with last week's data showing a 6.2% year-over-year jump in February's CPI.

The decision however was seen as dovish, since the bank changed its guidance [2]. It said that further modest tightening in monetary policy "may be appropriate" in the coming months, from February's more hawkish "is likely to be appropriate" reference.

Mr Bailey commented yesterday that this change in language "is a reflection of the level of the level of uncertainty and the risks we face".

GBP/USD Analysis

Mr Bailey's comments and US Dollar strength weighed on the pair yesterday, leading to a roughly 100-pips slump, but today it tries to find support. This may give it the opportunity to retake 1.3159-64, but we remain cautious about its prospects of bigger rebound towards and beyond 1.3270-1.3300.

Why Trade with FXCM

Commission free with fast, efficient execution.

This area contains the 200EMA and the 38.2% Fibonacci of the drop form this year's high's to the lows, which the British Pound had rejected last week. As such, bears retain control and can push back towards 1.2999-80, but it may still be early for a larger decline that would threaten 1.2829.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.



Retrieved 29 Mar 2022


Retrieved 04 Oct 2022


Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.

Risk Warning: Our service includes products that are traded on margin and carry a risk of losses in excess of your deposited funds. The products may not be suitable for all investors. Please ensure that you fully understand the risks involved.

${} / ${getInstrumentData.ticker} /

Exchange: ${}

${} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}