The pound sterling moved higher against the US dollar as Forex traders await news from the Federal Reserve Chairman. Expectations are that the US government will finally approve a large fiscal stimulus package under the Biden administration which, analysts say, would improve risk sentiment in general. The pound is also finding support from the British government's widespread roll-out of the vaccine to combat the coronavirus spread. While the death toll in Britain has now surpassed 100,000, the initial roll-out and the government's plan to get every individual vaccinated against the viral threat has been enough to keep sentiment for the pound positive.
As of 10:40 am, in London trading, the GBP/USD was trading higher at $1.3739, a gain of 0.0342%, sliding away from the session peak which was set at $1.37594; the low was recorded at $1.37207. The EUR/GBP was lower at 0.8827 pence, down 0.2768%; in today's trading day, the pair has ranged from 0.88247 pence to 0.88619 pence. The GBP/JPY was trading higher at 142.566 yen, up 0.1665%, off the session high of 142.675 yen.
Markets Focus on Fed Decision, Durable Goods
Forex market players are waiting for today's decision from the Federal Reserve. Analysts recently polled predicted that the Fed will maintain the current interest rates at the existing level of 0.25%. The statement which accompanies the decision, and the press conference which follows, will offer more clues as to the direction the Fed intends to take. While currently, Jerome Powell remains the Chairman of the Fed, the US President does have the right to appoint a new head of the central bank, if he so chooses. Also expected today are data on durable goods orders for the month of December. A recent poll suggests that new durable goods orders will decline to 0.9% from 1%, while non-defense capital goods orders (which exclude aircraft) will rise to 0.6% from 0.5%.