Attention Turns to the Pound’s Upside Following Agreement on Northern Ireland Trade Rules
28.02.2023
- Chicago Purchasing Managers' Association Business Activity Index
- U.S. S&P Case-Shiller Home Price Index
Yesterday, the U.S. dollar weakened against the pound, and the GBP/USD pair rose by approximately 130 pips from 1.1922 to 1.2066.GBP/USD has been rising after breaking above the 200-period SMA on the hourly chart and has also broken well above the 20-period MA on the 4-hour chart. However, as the pair is currently trading just below the 75-period MA on the 4-hour chart, that level could act as resistance, so we need to carefully monitor the direction of the trend.
Among European currencies, the euro weakened against the pound, with the EUR/GBP pair falling from 0.8835 to 0.8788.The pound rose across the board yesterday on positive sentiment following an agreement between the UK, the EU, and Northern Ireland to resolve friction over trade rules. Since the EUR/GBP pair is showing a triple top pattern on the daily chart, we should remain cautious about a potential further decline, just to be on the safe side.
Today’s schedule includes Turkey’s Q4 GDP at 16:00, France’s Consumer Price Index and Q4 GDP at 16:45, Switzerland’s KOF Leading Index at 17:00, and at 19:15, the UK’sRemarks by BOE Deputy Governor Kanlif at 9:15 p.m., remarks by MPC Member Pill at 9:15 p.m., remarks by MPC Member Mann at 9:30 p.m., Canada’s GDP and U.S. wholesale inventories at 10:30 p.m.,at 23:00: U.S. S&P Case-Shiller Home Price Index; at 23:45: U.S. Chicago Purchasing Managers’ Index; and at 24:00: U.S. Consumer Confidence Index. We will be watching the upside potential of the pound, which has been bought on the back of the agreement on trade rules for Northern Ireland.
Author: Keisuke Sakurai
