BoE's plans for additional rate cuts are in conflict
<Fundamental>
Expectations are mounting that the BoE would implement additional rate cuts. BoE Governor Andrew Bailey has stated that inflation is decreasing more rapidly than anticipated. The UK CPI for September registered at 1.7%, falling short of the central bank's 2% target, which has intensified speculation about upcoming rate increases. Wall Street is convinced that with UK inflation already below the target, there's a strong likelihood of additional rate cuts in November and December following the recent 25bp reduction.
However, there are concerns regarding the potential aftereffects of hasty rate cuts. BoE economist Catherine Mann emphasizes that, despite a general slowdown in inflation, service price inflation continues to soar. She warns that an impulsive rate hike could reignite inflationary pressures.
<Technical>
GBPUSD advanced to the 1.3000 threshold. After breaching the descending channel’s upper bound, the price holds above both EMAs, signaling a trend reversal. If GBPUSD breaches the resistance at 1.3045, the price may gain upward momentum toward 1.3265. Conversely, if GBPUSD fails to hold above both EMAs, the price may break the channel’s upper bound again and re-enter the descending channel.
Expectations are mounting that the BoE would implement additional rate cuts. BoE Governor Andrew Bailey has stated that inflation is decreasing more rapidly than anticipated. The UK CPI for September registered at 1.7%, falling short of the central bank's 2% target, which has intensified speculation about upcoming rate increases. Wall Street is convinced that with UK inflation already below the target, there's a strong likelihood of additional rate cuts in November and December following the recent 25bp reduction.
However, there are concerns regarding the potential aftereffects of hasty rate cuts. BoE economist Catherine Mann emphasizes that, despite a general slowdown in inflation, service price inflation continues to soar. She warns that an impulsive rate hike could reignite inflationary pressures.
<Technical>
GBPUSD advanced to the 1.3000 threshold. After breaching the descending channel’s upper bound, the price holds above both EMAs, signaling a trend reversal. If GBPUSD breaches the resistance at 1.3045, the price may gain upward momentum toward 1.3265. Conversely, if GBPUSD fails to hold above both EMAs, the price may break the channel’s upper bound again and re-enter the descending channel.
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