Fundamental view:
The British pound has rallied to break above the 1.35 level during the week. The EU and the UK leveled up the pound with Level-Playing Field progress – and now it is down to fish to seal a Brexit deal. Apart from the incessant noise of headlines from the talks, investors may have time to take stock of a turbulent end to 2020 in the short holiday week. Comments from the talks in Brussels and from officials in London have generally moved in a positive direction which helped the pound.
During the week, US Building Permits on 17th December and US Current Account & US CB Leading Index monthly report created bearish atmosphere whereas Britain Unemployment on 15th December and US TIC Long-Term Purchases on 16th December favors bullish environment for the pair.
The major economic events deciding the movement of the pair in the next week are UK GDP quarterly report, UK Business Investment quarterly report, US GDP quarterly report, US CB Consumer Confidence Index at Dec 22, US Core Durable Goods Orders monthly report, and US Initial Jobless Claims at Dec 24.
GBP/USD Weekly outlook: