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GBPUSD - Weekly Outlook: June 24-28

Release Time:2019-06-24 03:24

GBPUSD (1.2660) • UK Public Sector Net Borrowing for May of GBP 4.5bn was a little higher than market expectations but the data had little impact on the GBP. BoE Gov. Carney said the UK will not be able to avoid tariffs with the EU in the event of a no-deal Brexit—clashing with the position advanced by Tory leadership hopeful Johnson. Opinion polling showing the Tories lagging in third behind the Brexit Party and the Lib Dems suggest that Johnson and Hunt will have to maintain a relatively confrontational approach to the Brexit issue in the next few weeks in order to generate support from hard-Brexit-leaning Tory party members. 

GBPUSD short-term technicals: Neutral/bearish—GBP gains on the week have moderated, leaving the market in neutral territory at this point—nowhere near key break out resistance at 1.2760/65 but holding well above recent lows. Intraday price action looks a little soft for Cable after two (failed) tests of 1.2725. Risks are tilting towards a drop back to 1.2600/05, we think