GBP/USD slumps to 27-month lows near 1.2400
|- Labour market data from the UK weigh on the British pound on Tuesday.
- Greenback gathers strength ahead of retail sales data and Fedspeak.
The GBP/USD pair lost more than 100 pips on Tuesday slumped to its lowest level since April 2017 at 1.2407. Following the sharp drop, the pair staged a technical correction and was last down 0.7% on a daily basis at 1.2430.
Earlier today, the data published by the UK's Office for National Statistics showed that the claimant count rate in June rose to 38K in June from 24.5K in May and came in worse than the market expectation of 22.8K. Although further details of the report revealed that the average earnings, including bonuses, expanded by 3.4% in May following April's reading of 3.2% and the unemployment rate remained unchanged at 3.8%, the British pound struggled to find demand.
Additionally, the broad ongoing USD recovery ahead of key retail sales data, which is expected to increase by 0.1% on a monthly basis in June, keeps the bearish pressure on the pair intact. At the moment, the US Dollar Index is up 0.33% on the day at 97.24.
Later in the session, FOMC Chairman Powell and FOMC members Bostic, Bowman, and Evans will be delivering speeches.
Technical levels to watch for
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