GBP/USD mildly bid ahead of UK employment data, Carney’s speech

Declining odds for no-deal Brexit favors the GBP/USD pair’s recovery.
The UK employment numbers and Carney’s speech will join the US Retail Sales and Fed Chair’s comments to offer fresh impulse.

Anil Panchal FXStreet

Receding fears of hard Brexit help the GBP/USD pair to recover previous losses while taking the rounds to 1.2520 ahead of the London open on Tuesday. Investors may now keep an eye over monthly jobs report and BOE Governor Carney’s speech at G7 for fresh clues. Additionally, trade/political news report, the US Retail Sales and the Fed Chair’s comments will also be closely examined for near-term market direction.

The Bloomberg reported the latest EU-UK Brexit talks as constructive backed by the EU’s readiness to avoid no-deal Brexit while the BBC story covering Sir Oliver Letwin, a senior Tory member, also reduced odds of no-deal Brexit.

Elsewhere, the candidates for the UK Prime Minister’s (PM) race continue to lure Tory voters during their latest public appearances, the last one will be on Wednesday in London. While the frontrunner Boris Johnson keeps his promise to let exit the EU on October 31, Jeremy Hunt highlights his ability to discuss a fresh trade deal with the EU. However, both the candidates turned down chances of a general election before the Brexit.

Looking forward, the economic calendar will be on the watch for the UK’s May month Average Earnings and Unemployment Rate, coupled with the June month Claimant Count Change, that will precede the US Retail Sales data for June. Also, comments from the US Federal Reserve Chairman Jerome Powell and the Bank of England (BOE) Governor Mark Carney at the French G7 Presidency 2019 will also direct near-term market momentum.

The UK’s Claimant Counts may decline to 18.9K from 23.2K prior whereas Average Earnings Excluding Bonus (3 months to a year) is likely increasing to 3.5% from 3.4%. Further, the British Unemployment rate isn’t expected to deviate from 3.8%. On the other hand, US Retail Sales can flash 0.2% MoM growth versus 0.5% prior while Retail Sales Control Group is likely declining to 0.3% from 0.4% (revised) earlier.

Technical Analysis

Pair’s recent recovery remains doubtful unless it clears 21-day exponential moving average (EMA) level of 1.2585, that holds the key to a late-June low around 1.2665. As a result, the latest lows surrounding 1.2480 and 1.2430 may keep flashing on the bears’ radar.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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