Interest rate decision remains in focus

April 05, 2022

GBP/USD: Sterling gained versus the dollar on Monday as traders continue to bet on a rapid pace of interest rate rises from the Bank of England. Investors will also be listening closely for any clues on that pace when BoE Governor Andrew Bailey speaks later on Monday. This week is light on important UK economic data, and markets will be focused on any talk about rate hikes, as well as how financial markets and risk sentiment hold up amid the situation in Ukraine. Immediate resistance can be seen at 1.3150. A breakout up can trigger growth towards 1.3250.


BUY STOP 1.3150/TP 1.3250/SL 1.3120

 

USD/CAD: The Canadian dollar strengthened against the U.S. dollar on Monday as oil prices rose and investors awaited the release of two Bank of Canada surveys that could offer clues on the inflation outlook. U.S. crude prices were up 3.4% at $102 a barrel as the release of reserves by consuming nations failed to eliminate supply fears arising from events in Eastern Europe and the lack of an Iranian nuclear deal. Oil is one of Canada’s major exports. The Canadian dollar will keep being supported by expectations of a key interest rate hike. Immediate support is seen at 1.2460. A breakout below could take the pair towards 1.2400.

SELL STOP 1.2460/TP 1.2400/SL 1.2480

 

EUR/USD: The euro declined on Monday as talks of Europe banning Russian gas weighed on the single currency. The euro remains under pressure due to worries about the economic damage from events in Eastern Europe. Among other factors of the euro decline are high inflation, the energy crisis, as well as the unwillingness of the monetary authorities to tighten monetary policy. Immediate support is seen at 1.0950. A breakout below could take the pair towards 1.0800.


SELL STOP 1.0950/TP 1.0800/SL 1.1000