Post #16167

Priced For Hikes, But It's Not Guaranteed. (GBP/USD) GBP/USD at 1.3493, sliding back toward the lower end of the daily range. Price is sitting just below a well-tested resistance zone. The BoE holds Thursday with an 8-1 vote expected — only the most hawkish MPC member likely to push for a hike. But here's the nuance: markets have already priced two hikes, and that repricing alone has tightened financial conditions enough to slow activity. Berenberg's Wishart argues the BoE may not need to follow through and could return to cuts by year-end. Sterling is also absorbing political drag. Starmer's Mandelson controversy ahead of May 7 local elections is adding noise, with Labour expected to take significant losses. Not a primary driver, but it layers uncertainty at the margins. Three central banks this week. GBP's direction depends less on the BoE's hold and more on the collective tone. If the Fed leans hawkish while the BoE signals patience, dollar strength resumes and this 1.35 area gives way. - Alan