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UK Gilt Yields suggest slow recovery in GBP/USD pair - FXStreet

“The GBP/USD pair rose 40 odd pips to 1.5670 levels, tracking a rise in the Gilt yields and a marginal weakness in the US Treasury yields.” says Omkar Godbole, Analyst and Editor at FXStreet.

Key Quotes

"Sharp gains in the GBP/USD pair are unlikely as the gains in the Gilt yields are likely to be capped around 2.25%."

"On the other hand, the Treasury yields are more likely to rise since the Fed is relatively hawkish when compared to the BOE."

"However, the GBP/USD pair is oversold and a technical correction coupled with a modest rise in Gilt yields could push the pair closer to 1.58 levels."

"Moreover, the surge in Gold prices witnessed in last few sessions indicates a possibility of correction in the US Dollar against other major currencies. Thus, losses in the GBP/USD pair are likely to be capped around 1.555 levels."

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