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The GBPUSD Rebounds Following Rishi Sunak Budget Speech



© Reuters.

By Sam Boughedda

Investing.com — The saw a bounce earlier today following U.K. Chancellor Rishi Sunak’s budget speech.

In the upbeat speech, Sunak said the U.K. economy had not been hit as hard as expected by the Covid-19 pandemic while using the positive economic forecast to unveil tax cuts and higher public spending. 

In addition, he also promised multibillion-pound initiatives to assist Prime Minister Boris Johnson in meeting his “levelling up” commitments to voters.

“Employment is up. Investment is growing,” Sunak told MPs. 

“The public finances are stabilizing and wages are rising,” he added.

In a further positive for the U.K. economy, Sunak said the Office for Budget Responsibility (OBR) believes the economy will return to pre-Covid levels at the turn of the year, approximately six months earlier than anticipated. 

After a recent fall in the pound due to Brexit trade worries stemming from the Northern Ireland protocol, the GBPUSD saw a small bounce following the speech.

Earlier in the session, the pair hit a low of 1.3710, putting it firmly in the red for the day. However, it has retraced post-speech and now finds itself sitting above the 1.3750 mark supported by Sunak’s comments, Bank of England rate hike expectations, and a weaker U.S. dollar, although it is still down around 0.06%. 

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