Home Forex Analysis And Forecasts Pound to Look Past BOE Rate Decision, Greece Crisis Back in Focus

Pound to Look Past BOE Rate Decision, Greece Crisis Back in Focus

The British Pound is unlikely to find fuel in the Bank of England rate decision while the crisis in Greece will return to the spotlight as another deadline looms.

Talking Points:

  • Yen Pulled Back, Australian Dollar Rose as Risk Appetite Stabilized in Asia

  • Bank of England Policy Decision Likely a Non-Event for the British Pound

  • Greece Crisis Back in Focus as PM Tsipras Submits New Debt Deal Plan

The Japanese Yen underperformed in overnight trade, falling as much as 0.6 percent on average against its leading counterparts, as a recovery in risk appetite weighed on the safety-linked currency. The sentiment-geared Australian Dollar advanced, adding 0.7 percent against the majors.

Besides ebbing risk aversion, the Aussie unit found added support in upbeat Employment data. The economy unexpectedly added 7.3k jobs in June, topping forecasts calling for a flat outcome. Australian front-end bond yields pushed higher after the release, suggesting the outcome helped trim RBA interest rate cut speculation.

Looking ahead, a monetary policy announcement from the Bank of England headlines the economic calendar in European trading hours. No changes are expected, which typically means Governor Mark Carney and company will issue no forward guidance statement. That means the announcement will probably amount to a non-event for the British Pound.

The crisis in Greece will likewise return to the spotlight. Prime Minister Alexis Tsipras is due to submit a new proposal for a deal exchanging reforms for new EU bailout funding. Traders will be watching the newswires for confirmation that Athens met the deadline and any commentary from the creditor camp on the proposal’s merit. Firm directional cues seem unlikely until the weekend’s EU summit however.

Critical Levels
CCY Supp 3 Supp 2 Supp 1 Pivot Point Res 1 Res 2 Res 3
EURUSD 1.0810 1.0929 1.1003 1.1048 1.1122 1.1167 1.1286
GBPUSD 1.5112 1.5249 1.5305 1.5386 1.5442 1.5523 1.5660


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