GBP/USD rises to near 1.2700 ahead of UK Budget Report

GBP/USD recovers intraday losses ahead of the Budget Report from the United Kingdom on Wednesday.
UK Chancellor Jeremy Hunt is expected to reduce national insurance contributions.
Fed Chairman Jerome Powell will testify before the US Congress' House Financial Services Committee.

Akhtar Faruqui FXStreet

GBP/USD retraces daily losses and seems to continue its winning streak, hovering around 1.2700 during the Asian trading session before the UK Chancellor Jeremy Hunt's Budget Report on Wednesday. Hunt is slated to unveil the government's fiscal agenda, outlining tax and spending plans ahead of the general election. Speculation suggests he may reduce national insurance contributions for employees, following a 2p reduction announced in the autumn statement.

UK’s BRC Like-For-Like Retail Sales (YoY) for February fell short of expectations, posting a figure of 1.0% compared to the anticipated 1.6%. This figure contrasts with the previous period's 1.4%. Later in the day, the S&P Global/CIPS Construction PMI for February is scheduled to be released, offering further insights into the UK's economic performance.

The US Dollar Index (DXY) attempted to halt its three-day losing streak, but returned to near 103.80, driven by subdued US Treasury yields. The 2-year and 10-year yields on US Treasury bonds stand at 4.55% and 4.14%, respectively, by the press time.

Investors are closely watching Federal Reserve (Fed) Chairman Jerome Powell's testimony before the US Congress' House Financial Services Committee, scheduled for Wednesday and Thursday. However, the US Dollar (USD) encountered downward pressure following softer-than-expected data from the US ISM Services Purchasing Managers Index (PMI). Additionally, attention is on the ADP Employment Change report for February, set to be released in the North American session.

The ISM Services PMI fell to 52.6 in February, below the anticipated decrease to 53.0 from 53.4. Moreover, Factory Orders (MoM) declined by 3.6% in January, surpassing the expected drop of 2.9%. Former New York Fed economist Steven Friedman suggested that Federal Reserve policymakers are likely to remain cautious about interest rate cuts in 2024 due to growth and volatile inflation. He hinted at the possibility of fewer rate cuts than the three initially anticipated for 2024.

GBP/USD

Overview
Today last price	1.2704
Today Daily Change	-0.0001
Today Daily Change %	-0.01
Today daily open	1.2705

Trends
Daily SMA20	1.2637
Daily SMA50	1.2674
Daily SMA100	1.2564
Daily SMA200	1.258

Levels
Previous Daily High	1.2735
Previous Daily Low	1.2671
Previous Weekly High	1.27
Previous Weekly Low	1.26
Previous Monthly High	1.2773
Previous Monthly Low	1.2518
Daily Fibonacci 38.2%	1.2711
Daily Fibonacci 61.8%	1.2696
Daily Pivot Point S1	1.2673
Daily Pivot Point S2	1.264
Daily Pivot Point S3	1.2609
Daily Pivot Point R1	1.2736
Daily Pivot Point R2	1.2767
Daily Pivot Point R3	1.28

Author

Akhtar Faruqui

FXStreet

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.

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