GBP/USD struggles for direction near 1.2750, BoE eyed

The Sterling is alternating gains with losses vs. the greenback on Thursday, taking GBP/USD to the mid-1.2700s ahead of the BoE event later in the European morning.

GBP/USD focus on data, BoE

After reaching tops in the vicinity of 1.2820, Cable surrendered part of those gains following the FOMC decision to hike rates by 25 bp, taking the Fed Funds ramge target to 1.00%-1.25%, broadly in line with market expectations.

The pair managed to gather extra traction early on Wednesday despite poor readings from the UK’s labour market, while the up move was bolstered by disappointing figures from US inflation figures and retail sales during the month of May.

Regarding today’s docket, the BoE is universally expected to leave its refi rate unchanged, although the absence of the usual press conference by Governor Carney could remove some relevance from the event.

However, investors’ focus should shift to the annual Mansion House event later in the British evening, where Governor Carney and Chancellor P.Hammond are due to speak and could shed more detail on the future steps of the BoE as well as their vision on the current agitated political scenario in the UK.

GBP/USD levels to consider

As of writing the pair is up 0.02% at 1.2748 facing the next resistance at 1.2796 (55-day sma) followed by 1.2818 (high Jun.14) and then 1.2873 (20-day sma). On the downside, a breakdown of 1.2632 (low Jun.9) would open the door to 1.2626 (100-day sma) and finally 1.2566 (200-day sma).