August 20, 2024 15:02 GMT
GBPUSD: Pressure on US Yields Results in New Highs for Cable
GBPUSD
- Another slip and edge lower in the belly of the US yield curve prompting further losses for the greenback - and new highs for both EUR/USD and GBP/USD just ahead of the London close - with possible WMR fix-tied trading playing a part.
- GBP/USD has now traded clear of the mid-July highs and is set for a close above the 1.30 handle, which opens gains toward the '23 highs bull trigger at 1.3142.
- Thursday's prelim August PMI numbers will be of particular focus, and markets will be watching to confirm whether the stabilisation of sentiment in July was largely due to the perception of political stability after the General Election, or the beginning of a broader trend for stronger sentiment.
- Both hiring and new orders were greenshoots in the July survey - and further strength here could limit the pricing for BoE cuts across the second half of '24, via either softer pricing for September (8bps cuts currently priced) or December (cumulative 41bps priced).
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