FX.co ★ The pound is waiting for external conditions to further reduce

GBP / USD

British investors took advantage of the confusion in the dollar on Tuesday and fixed short positions which was opened in the previous five sessions. The pound added 37 points. However, there were also positive news from the UK. Net borrowing of the public sector in March fell by 0.3 billion pounds against expectations of an increase to 1.1 billion pounds. Constant balance of production orders from CBI (4), which has remained unchanged since March, has kept the bleak prospects of industrial production but did not show any deterioration in the current situation, even in the April assessment.

Sales of new homes in the US increased by 4.0% in March against the forecast of 1.9%. The consumer confidence index from the CB was 128.7 against the forecast of 126.0. However, this did not help the stock market, which lost 1.34% on fears of further growth in yields on government bonds. The yield on 10-year-bonds reached a psychological level of 3.0% yesterday. Obviously, the markets have to adapt to the new realities and only then can they continue to grow. To do this, it is enough to recall that in the active post-crisis recovery phase, the yield on these securities reached 4.0%, and before the crisis it was at 5.2%. Also, the US monetary institutions will be on the side of the stock market, since the external debt is already 21.003 trillion dollars. Donald Trump announced the imminent start of negotiations with China on a large-scale trade deal that will replace mutually raised tariffs.

Today, important data on the UK and the US will not come out. Tomorrow, the ECB decides on monetary policy and the US will publish a trade balance report. Investors will prepare for these events. We are waiting for lateral movement in the range of 1.3910-1.3980.