GBPUSD:
Sterling is steady around 1.35 despite softer September leading indicators in the UK. The slowdown in the composite PMI reflects business caution amid fiscal uncertainty ahead of the autumn Budget. Meanwhile, the Bank of England kept the Bank Rate unchanged last week, and its communication points to a slow and careful path toward making policy less restrictive, which removes some pressure from the currency.
The external backdrop helps as well: the Fed has taken an initial step toward lowering rates and stresses a gradual approach from here. That caps the dollar’s upside and supports interest in highly liquid currencies with relatively stable central-bank guidance, such as the pound. While demand for safe-haven assets persists in commodities and equities, moderate inflows into currencies with positive real yields remain intact.
Main risks for the pair include weak UK manufacturing, cooling employment, and the possibility of softer external demand. Still, with the current balance of factors and the BoE’s neutral stance, the short-term setup favors GBP/USD drifting toward 1.3560, with risk controlled below 1.3460.
Trading recommendation: BUY 1.3510, SL 1.3460, TP 1.3585
Origin: FreshForex
