© Dukascopy Bank
During the September 7– 11 trading week, one of the most popular currency pair on the foreign exchange market traded in a upside manner. It was influenced considerably by the UK economic data releases. Starting the week on a rather negative note, around 1.52 level, the pair advanced 200 pips by the end of the week. On Tuesday, the Sterling rose to almost one-week highs against the US Dollar, as sentiment on the Greenback remained vulnerable ahead of the Federal Reserve's highly-anticipated policy meeting this week. Nevertheless, the next day the Cable fell to session lows after data revealed that UK industrial output unexpectedly fell in July while country's trade deficit widened sharply. According to the Office for National Statistics, UK industrial production fell by 0.4% in July and rose just 0.8% from a year earlier. Manufacturing production, in turn, declined 0.8% in July, posting the largest drop since May 2014 and was 0.5% lower on a year-over-year basis. Eventually, by the end of the week the pair soared to two-week highs against due to the Bank of England decision to keep monetary policy unchanged.
Dukascopy traders, in turn, became bullish decided on future perspectives of this pair's movement. The bullish opinion is supported by Racer X, who suggests that "I am expecting to see the advanced Sterling against the Dollar. The favorable economic data out of the UK indicating that BoE wants to get the rate hike before the Fe's meeting. I am not inclined to think that the Cable will climb much higher than the 1.5800~zone." Meanwhile, khalidamassi supports bearish outlook, and claims that: "The GBP/USD will be affected mostly by Fed's meeting. The rate raise will hit the GBP/USD to 1.5000-1.5200, if FED holds then the Pound may touch 1.5600 level."
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© Dukascopy Bank