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GBP/USD still oversold
As widely expected, the Bank of England left interest rates unchanged. Judging by the market’s reaction to this, and the pound’s inability to hold onto the small gains at the beginning of the week, the sentiment remains firmly bearish. Many are now focused on Wednesday 20 August when we will see if any of the voting members have decided to support an increase yet.
Since 2011 we have not seen any of the Monetary Policy Committee members vote to do anything other than to hold rates. Although the picture painted by economic releases from the UK continues to point towards recovery, the pace of improvement in the US has picked up in comparison.
GBP/USD is still oversold but still above the 200-day moving average down below at $1.3735, and it is possible that this might offer some support.