GBP/USD Hits Intraday High as BoE's Bailey Keeps Hawkish Tone

28 Mar 2023

The GBP/USD pair has once again hit an intraday high as bullish sentiment continues for a second day. Optimism around Brexit and hawkish comments from Bank of England Governor Andrew Bailey have propelled the British Pound. Meanwhile, the US Dollar is being weighed down by fears of banking fallouts, mixed Federal Reserve talks, and downbeat yields.

GBP/USD is currently trading near 1.2320 as the risk-on mood in the market has combined with positive headlines from the UK to support Cable buyers. Bailey's hawkish comments on inflation and the potential for further monetary tightening have added strength to the pair's upside momentum, particularly after similar comments from him on the previous day.

Brexit barriers and labor problems that have recently affected the British economy have also contributed to the Cable pair's upward movement. On the other hand, the US Dollar is being weighed down by global policymakers' efforts to prevent banking contagion, as well as deposit insurance schemes and emergency credit lines extended to troubled banks.

Recent comments from central bank officials pushing back against concerns of a banking crisis and the Silicon Valley Bank (SVB) deal have also contributed to the risk-on mood in the market, further weighing on the US Dollar.

Looking ahead, GBP/USD bulls will be looking for further hawkish comments from BoE's Bailey, as well as softer prints of the US Conference Board's (CB) Consumer Confidence for March, to maintain their position.