GBP/USD consolidates around the 1.3170-80 levels
This after the fact that there were a couple of headlines crossing the wires about Trump wanting a hard Brexit otherwise it would jeopardise a potential trade deal between the US and the UK. But apart from speculation and threats, that's about it.
GBP/USD fell to a low of 1.3170 on the back of that but was supported by the 4 July low @ 1.3171. Further support is seen around 1.3150 before bids at 1.3100 come in and then the 38.2 retracement level on the daily chart @ 1.3055 comes in.
The white paper didn't offer any fresh leads on Brexit developments, so now we're going to have to wait on the EU's response to it. That may take a while still, so the focus later on will be all about how sterling traders navigate the early morning headlines between May and Trump on Brexit and trade.
But apart from any concrete or official word, I doubt we'll see too much speculative trading in sterling (both to the upside or downside) - not when we have a big week coming up starting from next Tuesday.
We'll be getting the UK inflation report, wages data, and retail sales all next week - and these will be the most important set of data that will make or break expectations of a rate hike for the August meeting.
For all the domestic political issues faced by the UK, it is the BOE's ability to hike come August that will be the biggest driver in sterling for the time being.
