Tightening financial conditions in the US | 13 Octubre 2023

13 Octubre 2023, GBP/USD

Tightening financial conditions in the US

GBPUSD trading plan:

Shifting views on the Federal Reserve's monetary policy trajectory are roiling the U.S. Treasury market, as investors gauge how close the central bank is to pulling back from its aggressive monetary policy tightening. Benchmark 10-year yields tumbled at the start of the week as investors reacted to the widening conflict in the Middle East and dovish comments from Fed officials, who leaned into the possibility that interest rates may not need to go higher. Fed Vice Chair Philip Jefferson and Dallas Fed President Lorie Logan both said that the recent run-up in yields may be tightening financial conditions and could preclude the need for further rate increases. Their remarks bolstered the case for investors' betting the central bank is close to pausing its hiking campaign.

Investment idea: sell 1.2330 and take profit 1.2230.

David Johnson
Analyst of «FreshForex» company
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