Daily Forex Market Preview, 13/02/2018
The U.S. dollar was seen trading rather flat on Monday. Lack of economic data and a modest recovery in the equity markets saw most of the currencies trading in a range. Earlier today, BJ Governor Kuroda said that the central bank must maintain its QE program as it takes time for inflation to reach the BoJ’s 2% inflation target rate. Kuroda was addressing the Lower House Budget Committee.
Looking ahead, the economic data today will focus on the annual CPI data from the UK and will cover the period of January. Economists forecast that headline CPI in the UK rose 2.9% on the year. This marks a slower pace of increase in inflation for the second month. Core CPI is however expected to rise 2.6% on the year.
In the U.S. trading session, FOMC member Loretta Mester will be speaking while later in the evening, Japan will be releasing its preliminary GDP data. Economists forecast that GDP advanced 0.2% on the quarter, down from 0.6% previously.
GBPUSD intra-day analysis
GBPUSD (1.3841): The British pound stayed flat with price action confined to Friday’s range. Price was seen to be briefly consolidating near 1.3855 level where resistance is likely being formed. In the event that GBPUSD breaks above this level, we can expect price action to test 1.3978 which marks the next level of resistance. To the downside, the support seen at 1.3611 – 1.3589 will be tested in the near term. This will potentially mark the correction to the rally following which we could see renewed momentum taking shape.