GBP/USD remains pressured around 1.1450 as US dollar recovers

GBP/USD is consolidating the latest pullback from six-week highs of 1.1499, as the US dollar finds fresh demand amid a cautious market mood.

The safe-haven dollar is staging a modest comeback after disappointing US corporate earnings from the tech titans Microsoft and Alphabet marred a three-day rally on Wall Street and knocked off S&P 500 futures by 1%. The below forecast results from tech giants hinted at possible early signs of a slowdown in the US economy.

However, the pair remains supported by the advances in the Asian indices, as investors remained hopeful that the pace of US and global rate hikes will start to slow. Further, the pound also cheers the UK Prime Minister Rishi Sunak taking office, with eyes on his fiscal plan. Reports were doing the rounds on Tuesday that Sunak could delay its budget announcement beyond October 31.

The focus now shifts towards the US economic releases due later in the day, especially after the country’s CB Consumer Confidence Index rose to 108.00 in September from 103.6 in August (revised from 103.2). The US New Home Sales, Goods Trade Balance and Wholesale Inventories data will be closely eyed for fresh implications on the Fed rate hike outlook. The UK political and fiscal updates will also have a significant impact on the sentiment around the pound.

The spot could extend the retreat should the US dollar recovery gather strength on the renewed weakness in the Wall Street stocks, as investors digest the downbeat earnings and brace for another batch of corporate results. 

GBP/USD: Technical levels