GBP/USD sinks below 1.3500 as King Dollar regains strength post-Fed
The British Pound is under heavy pressure of the “King Dollar” on Friday, down 0.52% even though the docket in the US is absent, with just Federal Reserve officials crossing the newswires. UK data although positive, Retail Sales failed to underpin Sterling. The GBP/USD trades at 1.3482.
Market mood remains mixed amid a quad witching options expiring on Friday, which could trigger volatility in US equity markets. The US Dollar has recovered after failing to three-year lows, in the aftermath of the Fed’s monetary policy decision.
Minnesota Fed President Neel Kashkari said that he supported the rate cut his week as risks of an increase in unemployment, warranted some action. He said that it is hard to see inflation climbing much higher than 3% from tariffs and added that if the jobs market improves and inflation rises, the Fed should hold rates. He added that he is open to hike rates if economic conditions warrant.
Meanwhile, Wednesday’s Fed’s decision to cut rates by 25 basis points was fully priced by market participants, as the Dollar Index (DXY), which tracks the performance of the buck’s value against a basket of six currencies, rallied sharply and turned flat on the week at around 97.62.
On the UK, Flash PMIs, along with Bank of England (BoE) policymakers crossing the wires, are awaited.
Source: FXstreet.com
