GBP/USD tumbles to test 1.3000, hits two-week lows

• Pound extends slide across the board on hard Brexit fears. 
• GBP/USD breaks 1.3050 support and drops to test 1.3000. 

The GBP/USD accelerated the decline amid a decline of the pound across the board. Cable dropped to 1.3005, hitting the lowest level since December 4. As of writing, trades at 1.3020, with the negative momentum intact. 

GBP among weakest 

Over the last hours, the pound hit fresh daily lows, reversing sharply from previous levels. The currency made a new leg lower after the Queen’s Speech and the Bank of England decision. Concerns about the possibility of a hard Brexit keep rising and pushed GBP/USD further lower. 

Earlier today, as expected the Bank of England kept interest rates unchanged at the December meeting. Analysts at Danske Bank continue to see BoE cutting rates at the next meeting and warn there could be another cut during the second half of the year. “Market has priced in 16bp cuts from Bank of England by year-end 2020 (and not much for January) so if we are right about a cut next month this could add fuel to the GBP depreciation we have seen since the election.”

DXY up... modestly 

The greenback is posting mixed results on Thursday. Over the last hours, it rose versus the euro, the pound and the loonie but it lost ground against the yen, the Swiss franc and some commodity and emerging market currencies. 

The DXY is up modestly, trading slightly below 97.50, near weekly highs. US economic data failed to boost the greenback. All numbers released on Thursday came in below expectations (Jobless Claims, Philly Fed and Existing Home Sales). 

Technical levels