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The pound ignored so-called "Super Thursday": Despite the upbeat data, the GBP/USD pair repeated yesterday's trajectory, remaining within the 30th figure. Although, there were all the prerequisites for increased volatility of the pair. For instance, within one day the most important fundamental events occurred such as the Bank of England meeting, the publication of the quarterly report on inflation, Mark Carney's press conference, and the publication of PMI data in the construction sector of Great Britain. Such a set of information drivers could have a significant impact on the dynamics of the pair. However, as it often happens, overstated market forecasts did not meet expectations.
Such a phlegmatic reaction from the market was primarily due to the "shadow of Brexit". Against the background of yesterday's statements by British politicians, all other fundamental factors have been neglected for a while - including the English regulator's meeting. Traders do not risk opening large positions for the pair, focusing on the prospects of the Brexit divorce process. In the near future, it will become clear whether Teresa May is able to negotiate with the Labour Party or whether the question of approving the transaction remains in limbo until October 31. Naturally, in the conditions of such uncertainty, it is rather difficult to make trading decisions, even if there are certain signals from the Bank of England. At present, the situation is complicated by the fact that the English regulator also voiced a very controversial position.
Next week, negotiations between the government and the Labour Party will continue. Given the fact that Mrs.May plans to go to a vote before the elections to the European Parliament (May 25), the events can develop rapidly. The focus of market attention will now shift to this negotiation process. The fate of monetary policy and the fate of the pound will depend on its outcome.
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