upside momentum is not completely exhausted as the risk profile is full of optimism. A continuous oscillation of the
above the psychological resistance of 1.2000 indicates that bulls are in their comfort zone and more upside is still favored. is set to test the round-level support of 106.00 due to a sheer decline in safe-haven’s appeal. The downside momentum in the US Dollar could drag it to a test of a three-month low at 105.34 as odds of continuation of 75 basis points rate hike structure by the Federal Reserve are fading away.
The 10-year US Treasury yields have slipped below 3.69% as a majority of Fed policymakers are supporting a slowdown in the pace of hiking interest rates. The minutes of the Federal Open Market Committee cleared that think tanks are likely to observe the progress of the efforts made yet to bring price stability. Also, a reduction in financial risks is highly required now. in its November monetary policy. BOE Governor Andrew Bailey is expected to escalate interest rates further by 50 bps, according to a Reuters poll conducted on Nov 18-22.
BOE Chief Economist Huw Pill cited that surge in people quitting the British workforce because of ill health or early retirement could force the BOE to further increase interest rates, as reported by The Guardian. He further added that “Accelerating unemployment among the working age population is indicating an adverse supply shock, which could lead to higher payroll bills for the employers, and henceforth a rise in inflation”.