- GBP/USD bears take control and home in on the 2022 lows.
- The Fed's chair wore his hawkish hat to the Fed presser on Wednesday.
Trading at 1.3455, GBP/USD is down 0.35% on the day so far, falling in a move that followed a hawkish twist in today's Federal Reserve event. Cable has broken 1.3490 support and has plummetted to a low of 1.3444 in a move that was encouraged by hawkish comments from the Fed's chair, Jerome Powell.
Despite a relatively dovish statement, as per the most hawkish of market expectations, the US dollar and yields have soared on the back of a pivot during the Federal Reserve's chairman's press conference.
Jerome Powell stated in the post-Federal Open Market Committee statement presser that the central bank could move faster and sooner than they did the last time which has promoted both the US dollar and yields to extend gains for the day:
Fed's Powell's key comments
- We are of the mind to raise rates at the March meeting.
- The current economy means we can move sooner, perhaps faster than we did last time.
- Next meeting will be coming to more of the details on the Balance Sheet.
- Other forces this year should also bring down inflation.
- Quite a bit of room to raise rates without dampening employment.
- No decision made on policy path, path to be led by incoming data.
GBP/USD technical analysis
As a consequence, US equities are reeling in pain which is hurting the risk-sensitive currencies such as the pound vs the US dollar:
The bears are looking over the abyss at this juncture, in pursuit of the 2022 lows of 1.3431.