GBP/USD: UK political drama offers less action, focus on UK/US retail sales


  • GBP/USD remains on the back foot amid political pessimism in the UK.
  • Opposition leader vows no-confidence vote, Brexit delay, re-election.
  • All eyes on the July month Retail Sales from the US and the UK.

Despite much action in risk sentiment, the GBP/USD pair keeps the modestly unchanged status as it trades near 1.2060 heading into the Thursday’s London open.

Risk tone has been heavy off-late as sluggish activity data from China and the US-China trade tussle triggered the first in more than a decade yield curve inversion of the US 10-year and 2-year Treasuries. Adding to the sentiment is the latest drop of the US 30-year treasury yield to the record low under 2.0%.

At the domestic front, the opposition Labour party leader Jeremy Corbyn vowed to table no-confidence vote as soon as he feels confident of getting full support for it during early September. Reuters also quotes Mr. Corbyn while preparing for Brexit delay and heading an intermediate government if the Prime Minister (PM) Boris Johnson fails in the parliament vote. Additionally, The Guardian reported the news that the PM Johnson sparks cross-party backlash with his comments over ‘Brexit’ collaboration.

On the positive side, the UK’s Royal Marines agreed to release Iranian oil tanker, seized a month ago in Gibraltar, which in turn might ease the tension between the nations.

While the Cable becomes the last currency to react on the trade news, the UK/US Retail Sales numbers will be the key to search for fresh direction.

The UK Retail Sales are likely to weaken from 3.8% and 1.0% to 2.6% and -0.2% on YoY and MoM respectively. Further, Retail Sales ex-fuel could also weaken to -0.2% and +2.3% from 0.9% and 3.6% marks on a monthly and a yearly basis in the respective pattern. On the other hand, the US Retail Sales growth is also expected to weaken to 0.3% versus 0.4% prior whereas the headline Retail Sales Control Group could dip to 0.3% from 0.7% earlier.

Technical Analysis

1.2095-1.2100 becomes near-term key resistance holding the gate for the pair’s rise to a monthly high near 1.2210 while 1.2000 and 2017 low near 1.1987 will entertain sellers ahead of pushing them towards 2016 bottom surrounding 1.1806.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD flirts with 1.1100 as the dollar loses steam

The EUR/USD pair bounced from a daily low of 1.1065, as demand for the greenback receded during US trading hours. Upside caped for the shared currency amid fears of a German recession, Italian political turmoil.

EUR/USD News

GBP/USD losses upside momentum at the start of the key day

While optimism surrounding soft Brexit helped the GBP/USD pair to rise on the previous day, the Cable retraces to 1.2165 amid initial Wednesday morning in Asia. The UK PM’s visit to Germany will be closely observed.

GBP/USD News

USD/JPY: bears moving back to the front

Demand for safe-haven assets picked up in the American session. US 10-year Treasury note yield fell to 1.54% intraday, settles barely above. USD/JPY to resume decline on a break below 106.05, a Fibonacci support.

USD/JPY News

Gold prices tightening up as traders await the Fed's next call

Gold spot and futures climbed a touch on Tuesday, with spot prices rising 0.72% and travelling between a range of between $1,493.18 and $1,508.70 while Gold climbed $4.10, or 0.3%, to settle at $1,515.70 an ounce, clawing back some of the $12, or 0.8%, lost on Monday. 

Gold News

Top 3 Price Prediction Bitcoin, Ripple, Ethereum: Planning the next bullish move after consolidating gains

Trading cryptos is not a one-way street – meteoric unstoppable gains belong to the past. Nevertheless, the bullish sentiment seems to prevail. Digital coins advanced on Monday and are consolidating on Tuesday. 

Read more

MAJORS

Cryptocurrencies

Signatures


  •  
  •  
  •  
  •  
  •