GBP/USD: Less care for PM May’s resignation ahead of UK retail sales
|- Media reports expectations of Theresa May’s resignation as soon as today.
- Optimists expect faster Brexit progress after PM May’s departure.
- The April month UK retail sales in the spotlight.
GBP/USD trades modestly flat heading into London open, as investors care less for the UK Prime Minister Theresa May’s looming resignation amid expectations of a weaker UK retail sales report due later today.
The GBP/USD pair, also known as Cable, recovered from the lowest levels since early-January on Thursday as the US Dollar (USD) weakness and optimism surrounding faster Brexit progress if PM May resigns took over the bears.
Various news reports are on the rounds to spread speculations that Theresa May will announce her departure timetable today as she has already put a comma to today’s discussion on her Brexit proposal in the parliament.
The UK retail sales contribute the majority to the British gross domestic product (GDP) and are expected to witness a pullback. The forecast suggests a 4.6% YoY figure versus 6.7% previous growth whereas a contraction of -0.3% is expected on a monthly basis compared to +1.1% earlier increase.
On the other hand, the greenback holds yesterday’s data-driven weakness amid pessimism surrounding the US-China trade talks while monthly durable goods orders for April could give a fresh impulse to traders.
The US durable goods orders bear the consensus to dive to the tune of -2.0% versus downwardly revised +1.3% prior whereas nondefense capital goods orders ex-aircraft might also dip to -0.3% from +1.0 (revised) previous.
Technical Analysis
A sustained break of 10-day long descending trend-line at 1.2710 can validate the quote’s further rise to February bottom around 1.2770 while 1.2800 round-figure might appear on buyers’ mind afterward.
Alternatively, pair’s downside beneath 1.2600 might not refrain from visiting 1.2480 and then to January lows near 1.2430.
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