GBP/USD steadies near 1.3165 as markets brace for key US jobs data
- GBP/USD steadies as markets await the first US jobs report since the government reopening.
- Fed cut odds fall to 43% amid hawkish commentary, lifting DXY to 99.52 and denting risk sentiment.
- UK investors relieved as Chancellor Reeves rules out tax hikes; soft CPI could cement December BoE cut.
The Pound Sterling (GBP) remains firm during the North American session on Monday as traders prepare for the first Nonfarm Payrolls report from the US following the government reopening, which will be released on Thursday, a day that usually features Initial Jobless Claims. At the time of writing, GBP/USD trades at 1.3166, virtually unchanged.
Sterling holds firm while hawkish Fed commentary lifts the Dollar and BoE expectations hinge on upcoming UK inflation
The Greenback is recovering some ground after last week, as most of the Federal Reserve (Fed) officials struck hawkish commentary, triggering a re-pricing of a rate cut by the central bank at the December meeting. Data from the CME FedWatch Tool shows odds of 43% for a 25-basis-point cut.
Consequently, the US Dollar Index (DXY), which tracks the performance of the buck against a basket of six currencies, is up 0.25% at 99.52. In addition to a hawkish Fed, market players' fears of a possible AI bubble triggered a sell-off in US equity markets.
US Treasury yields are slightly down, with the 10-year note yielding 4.137% down one and a half basis points.
In the UK, investors are relieved by reports that Chancellor Rachel Reeves has no plans to hike income tax rates in the Autumn budget, contrary to what investors had been anticipating due to the fiscal hole.
The UK’s economy has begun to show signs of weakness following last week’s GDP figures. Now is the time for the release of the Consumer Price Index (CPI), which is expected to open the door for the Bank of England (BoE) to cut rates at the December meeting.
GBP/USD Price Forecast: Technical outlook
The technical picture indicated GBP/USD is consolidated, trapped within the November 13 low/high of 1.3100/1.3193, unable to decisively clear either side of the range, an indication of indecision. The Relative Strength Index (RSI) suggests that momentum is bearish, with the index standing below the 50 neutral level.
If buyers reclaim the 20-day SMA at 1.3197, further upside lies ahead, up next with the 200-day SMA at 1.3284. A breach of the latter clears the way for 1.3300. Conversely, if GBP/USD drops below 1.3100, a resumption of the downtrend could put in play the November 5 swing low of 1.3010.
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.18% | -0.01% | 0.36% | 0.06% | 0.53% | 0.22% | 0.15% | |
| EUR | -0.18% | -0.21% | 0.18% | -0.13% | 0.34% | 0.03% | -0.02% | |
| GBP | 0.01% | 0.21% | 0.35% | 0.07% | 0.53% | 0.22% | 0.17% | |
| JPY | -0.36% | -0.18% | -0.35% | -0.30% | 0.17% | -0.14% | -0.20% | |
| CAD | -0.06% | 0.13% | -0.07% | 0.30% | 0.47% | 0.15% | 0.09% | |
| AUD | -0.53% | -0.34% | -0.53% | -0.17% | -0.47% | -0.31% | -0.36% | |
| NZD | -0.22% | -0.03% | -0.22% | 0.14% | -0.15% | 0.31% | -0.05% | |
| CHF | -0.15% | 0.02% | -0.17% | 0.20% | -0.09% | 0.36% | 0.05% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
