GBP/USD: Optimism about the UK's reopening to push sterling higher

GBP/USD has been trying to find its feet after falling last week. In the view of FXStreet’s Analyst Yohay Elam, sterling is set to benefit from UK reopening and global cooldown.

Concerns about global growth could keep the dollar depressed

“Summer is here – officially there is a month left, but Brits are already taking advantage of the new regulations, which allow for foreign holidays in select countries. The latest round of easing has begun on Monday, and it also includes more leisure activities.” 

“Most Fed officials have been reiterating the position that inflation is transitory. Vice-Chair Richard Clarida and several of his colleagues will be speaking today. If they repeat the same message, the dollar could weaken.” 

“Taiwan, the world's largest producer of microchips, is suffering from a wave of infections, joining the ranks of Singapore, India, and other countries. While that may support the safe-haven dollar, it may convince the Fed to keep monetary policy highly accommodative. More dollars printed mean a weaker dollar.” 

“Cable is suffering from downside momentum on the 4-hour chart but is trading above the 50, 100 and 200 Simple Moving Averages, a bullish sign. With the Relative Strength Index hovering outside overbought conditions, the upside looks more appealing.”