GBPUSD Update: Cable is under selling pressure

UK gilts flash a negative sign for the Bank of England - FT -

Should the BoE walk down the negative interest rate policy, Gilt investors have a reference point in the government bond markets for Switzerland, Germany and Japan. A rise in bond prices boost capital gains for holders of debt as yields fall, even below zero. Rather than provide a fixed income, a negative yielding government bond behaves more like equity that pays no dividend and provides scope for either a capital gain or loss. Not good news for UK seekers of income, particularly when plenty of FTSE companies are slashing their dividends.


"Ultimately, this situation suits the UK government as it borrows heavily to fund spending in response to the health and economic shock. If markets are willing to purchase negative yielding bonds and keep gilt yields low, the BoE will be under less pressure to add further measures, leaving the job of propping up the economy to better-placed fiscal spending" Source : FT

We keep selling the cable.

Levels as described.

Comment:

TP 1 OK ... Bearish Continuation is predicted