Information published in Bloomberg that Prime Minister of Great Britain Theresa May has concluded that there is a need for Parliamentary vote on Brexit, has provoked sharp rise in the pound at today's Asian session.
The pair GBP/USD managed to regain by 0.4%, up to the level 1.2320. However, despite today’s significant rise by 150 points at the beginning of European session, many economists expect that the GBP/USD will fall to level of 1.2000.
Fundamental factors will be brought to the forefront, as they will have strong influence on the pair. The main factors are: Brexit and the impact it can have on the British economy; monetary policies of the Central Banks of the UK and the USA.
The Bank of England has lowered economic growth forecast for the next year to the historic low. The Bank expects that economic growth in 2017 will be at the level of 0.8% against previous forecast of 2.3%.
The USD continues to strengthen on the increasing expectations of the rate hike in the USA in December.
Today, traders are waiting for the minutes of the last FOMC meeting at 21:00 (GMT+3). The minutes will shed light on the future monetary policy and prospect for interest rate hike.
According to CME Group, probability of the rate hike in December has increased from 69.55% to 74.5%.