GBPUSD Fundamental Analysis Ahead of UK PMIs

GBPUSD recovers almost 90 pips from Friday’s NY low of 1.3306. Brexit optimism to keep the sentiment lifted around the pound. The focus remains on UK Markit Preliminary PMIs ahead of BOE. Here is the GBPUSD Fundamental Analysis of 16 December, 2019

16 December, 2019 | AtoZ Markets – British pound remains supported by Prime Minister Johnson’s commitment to sailing the UK out of the European Union (EU) swiftly before January 31st, 2020. His conservative party won an overwhelming majority in historic elections last Thursday.

GBPUSD Fundamental Analysis – 16 December 2019

Prime Minister Johnson will welcome 109 new Conservative legislators to Parliament on Monday. And he reiterates his promise to increase funding to the state health service.

Besides, the GBPUSD pair is also supported by increased expectations of an in the UK’s manufacturing sector activity. The Markit Preliminary Manufacturing PMI for December may reach 49.4 against 48.9 previously. The country’s PMI Services may reach 49.6 against 49.3 last.

On the USD-side of the equation, the markets are not yet impressed by the details of the US-China Phase One trade deal concluded last Friday. That capped the recovery of the US dollar among its main competitors. The US dollar index is now testing the 97 handles, retreating from the NY high of 97.24 reached on Friday.

At the press time, the pair is trading with significant gains of + 0.50% around 1.3390. That is having blocked its correction from the 19-month highs at 1.3515 just in front of the 1.33.

Read More: 16 December Free GBP/USD, EUR/USD and BTC/USD Trading Signals

UK Seeks Brexit Withdrawal Deal

Sterling bulls will hold the charge as the UK seeks to reach a Brexit withdrawal deal in Parliament before Christmas. The Bank of England (BOE) may signal a willingness to change course on monetary policy, with the British election out of the way.

Meanwhile, investors will be listening to comments from several Fed officials in the coming days after the Fed’s decision to hold rates last week.

Dallas Fed Chairman Robert Kaplan, New York Fed Chairman John Williams and Boston Fed Eric Rosengren will all speak Tuesday. Chicago Fed Chairman Charles Evans will talk about a day later. Fed Chairman Jerome Powell said banks’ view of the economy remains favorable.

As for the data, updates on industrial production, housing, consumer sentiment, personal income, and spending in the United States are all expected this week. In China, data on industrial output and retail sales exceed estimates, suggesting that the economy may stabilize.

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