GBP/USD perks up after FOMC minutes

Currently, GBP/USD is trading at 1.2876, up 0.06% on the day, having posted a daily high at 1.2905 and low at 1.2842.

The dollar is somewhat weaker across the board after the FOMC minutes. Despite the softer-than-expected UK CPI figures yesterday, GBP/USD has moved out of its consolidation to the upside targeting the previous aforementioned highs.

“Focus for markets was on quantitative tightening  and any comments on how concerned the Fed is about the low inflation which it now describes as 'below 2%' (previously 'somewhat below 2%').” and in that respect many saw sub 2% inflation for longer than expected while the Fed are split on assessment if inflation expectations well anchored. 

GBP/USD levels

Analysts at Commerzbank explained that yesterday GBP/USD dropped sharply to the six-month support line where the price has stabilised around today's lows.

"We continue to suspect that the 1.3267 current August high was the end of the up move, though. Once the six-month support line has given way the 1.2775/59 area will be in focus. It contains the December 2016 high and the April 21 low. Minor resistance comes in along the 55 day moving average at 1.2931. While trading below the next higher 1.3031/49 May and August 11 highs immediate downside pressure will be maintained. Further resistance sits at the 1.3126 July 18 high," explained the analysts.