|

GBP/USD hovers above 1.2150 major level, focus on UK employment, PMI data

  • GBP/USD struggles to extend gains as US Dollar rebounds.
  • UK Retail Sales dipped to 0.9% against the expected 0.1% decline.
  • Upbeat US Treasury yields provide support to underpin the Greenback.

GBP/USD struggles to continue the winning streak. trading around 1.2160 during the Asian session on Monday. However, the currency pair encountered a hurdle following the release of downbeat United Kingdom (UK) Retail Sales data for September on Friday. The Pound Sterling (GBP) managed to recover its losses against the weaker US Dollar (USD).

Monthly Retail Sales revealed a 0.9% decline, in contrast to the expected 0.1% decrease, following a modest 0.4% rise in August. On an annual basis, sales contracted by 1.0%, defying market predictions of a stagnant performance.

This dip in Retail Sales is indicative of the financial strain on households due to high inflation and increased borrowing costs. The significant drop in consumer spending is likely to have a notable impact on consumer inflation expectations. As a consequence of weakening spending, there's speculation that the Bank of England (BoE) might lean towards maintaining the current interest rates at 5.25% in November’s policy meeting.

US Dollar Index (DXY) attempts to recoup recent losses, possibly bolstered by robust economic data from the United States (US). Additionally, the upbeat US Treasury yields provide support in underpinning the US Dollar (USD), with the 10-year US Treasury yield standing at 4.96%, up by 0.92%, by the press time.

Federal Reserve (Fed) Chairman Jerome Powell, on Thursday, suggested that the central bank has no immediate plans to raise rates, providing support for the GBP/USD pair. Powell also mentioned that additional tightening of monetary policy might be necessary if there are further signs of growth or the labor market stops improving.

Atlanta Fed President Raphael Bostic shared his belief on Friday that the US central bank is unlikely to lower interest rates before the middle of next year. Fed Philadelphia President Patrick Harker reiterated his inclination to maintain unchanged interest rates.

Moreover, Fed Cleveland President Loretta Mester indicated that the US central bank is "at or near the peak of the rate hike cycle." However, Mester acknowledged that the data released during the previous week could influence the central bank's decision regarding the future of monetary policy.

Market participants will closely monitor the US S&P Global PMI on Tuesday, followed by the Q3 Gross Domestic Product (GDP) on Thursday, and the Core Personal Consumption Expenditures (PCE) on Friday. On the UK docket, Claimant Count Change, Employment Change, and S&P Global/CIPS PMI will also be eyed.

GBP/USD

Overview
Today last price1.2155
Today Daily Change-0.0010
Today Daily Change %-0.08
Today daily open1.2165
 
Trends
Daily SMA201.2182
Daily SMA501.2409
Daily SMA1001.2587
Daily SMA2001.2444
 
Levels
Previous Daily High1.217
Previous Daily Low1.2094
Previous Weekly High1.222
Previous Weekly Low1.209
Previous Monthly High1.2713
Previous Monthly Low1.2111
Daily Fibonacci 38.2%1.2141
Daily Fibonacci 61.8%1.2123
Daily Pivot Point S11.2115
Daily Pivot Point S21.2066
Daily Pivot Point S31.2038
Daily Pivot Point R11.2192
Daily Pivot Point R21.222
Daily Pivot Point R31.2269

Author

Akhtar Faruqui

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

More from Akhtar Faruqui
Share:

Editor's Picks

AUD/USD keeps the red near 0.6950 after weak Aussie jobs data

AUD/USD holds losses near 0.6950 on disappointing Australian jobs data, extending the previous day's retracement slide from the monthly high and hitting a fresh weekly low during Thursday’s Asian session. Meanwhile, declining US bond yields drag the US Dollar away from the April 2025 high, touched after Wednesday's hot US CPI, helping limit losses for the currency pair.

USD/JPY slides back below 158.00 as USD reverses post-CPI gains

USD/JPY extends the previous day's pullback from a three-week high, attracting follow-through selling and sliding below 158.00 during Thursday's Asian session. Traders remain on high alert amid speculation that authorities will step in to prop up the Japanese Yen. The US Dollar, meanwhile, reverses Wednesday's hot CPI-led gains to April 2025 highs as US bond yields retreat on China bond-buying talk, further pressuring the pair.

Gold: Upside remains capped by $4,200

Gold regains the smile and leaves behind three consecutive days of losses, advancing to the $4,170 region per troy ounce on Thursday. The precious metal’s recovery comes amid the fresh offered stance in the Greenback and declining US Treasury yields while investors remain cautious ahead of the Fed’s Warsh speech on Friday.

Ripple clings to $1.30 support as downside risks intensify

Ripple is stuck in a bearish trend, trading near $1.30 on Thursday. The remittance token’s bearish shift reflects the broader cryptocurrency market, which remains under heavy selling amid concerns about accelerating inflation in the US.

Budget preview: Is Healey impressing the bond market?

There is less than 2 weeks to go before the Chancellor delivers his first budget. Unusually for the UK, the economic and financial backdrop to this budget is upbeat. UK bonds have been rallying, the FTSE 100 is the top performing major stock index this week, and the Pound is also stabilising versus the Dollar.

Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff
Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.