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2025-09-17 19:04:18
Is the British Pound Aiming for 1.40? Central Bank Policy and Technical Signals Fuel the Pound. (1) Institutional analysts suggest that the British Pound against the US Dollar (GBP/USD) is poised to climb towards 1.40. This expectation is primarily based on the expected narrowing of policy interest rates by the Bank of England and the Federal Reserve, as well as positive signals on the daily chart. The market generally expects the Bank of England to slow its annual £100 billion reduction in its government bond holdings this week while maintaining its key interest rate at 4.00%, despite recent increased bond market volatility. Meanwhile, the Federal Reserve is expected to announce a 25 basis point rate cut on Wednesday (Beijing time), lowering its benchmark overnight rate to a range of 4.00%-4.25%, aimed at balancing a slowing labor market with moderate inflation. (2) Technical analysis suggests that the GBP/USD bullish cycle has continued, having successfully broken through and achieved a daily close above the 1.3635 Fibonacci level, the 76.4% retracement of the July-August decline from 1.3787 to 1.3143. This technical breakout increases the likelihood that the pair will eventually break through the 2025 peak of 1.3787. A sustained move above this level could lead to a test of the 1.40 level. The 14-day momentum indicator has remained positive since September 5, highlighting the overall bullish upside potential. However, a failure to hold above the 1.3635 Fibonacci level could signal a potential market top.
