The British currency declined in price against the Dollar to the support of 1.4100.
Rising inflation in the US and traders' confidence in the Fed's commitment to its monetary policy negate all the achievements of the pound. In particular, the index of business activity in the UK services sector rose to 62.9 points – the highest in several decades. Monetary policy in the UK is becoming less stimulating, and the risks for the forecast are shifted towards the growth of the national currency. The Bank of England will not make any changes in the first half of the year, but if the macroeconomic indicators remain strong, we can confidently expect a reduction in the quantitative easing program in the autumn.
The main event this week will be the Fed meeting on Wednesday. Most likely, the regulator will continue to talk about the temporary nature of inflation. Given that various Fed officials have recently been less confident in defending the status quo, it can be assumed that the Central Bank's rhetoric will change as early as August at the annual symposium in Jackson Hole, where it will announce the end of quantitative easing in December. With the US economy recovering, jobs rising and inflation rising, it is clear that the risks are shifted towards an early interest rate hike. The Fed is still talking about early 2024, but most forecasts suggest that 2023 is the more likely date.
Forex trading. Pound/Dollar GBP/USD forecast for today, June 14, 2021
The forecast assumes an increase in the Pound/Dollar exchange rate to the price values of 1.4130, 1.4150 and 1.4175.