|

GBP/USD turns negative from four-week highs as Dollar erases US CPI losses

  • US Dollar tumbles after CPI data, trims losses after Wall Street opening bell.
  • Inflation confirms slowdown in the US, Fed’s Harker expects 25 bps hikes now.
  • GBP/USD reveres sharply, drops below 1.2100.

In a volatile session for FX, the US Dollar has reversed sharply during the last hour and turned positive across the board. The GBP/USD peaked after the release of US inflation data at 1.2244, the highest level in four weeks, and as of writing, it is trading below 1.2100, at the lowest since Monday.

Dollar tumbles then soars

Inflation data triggered a decline of the US Dollar that then recovered as equity prices in Wall Street dropped following the opening bell. The US Consumer Price Index fell in December 0.1% and the annual rate slowed to 6.5% from 7.1%, reaching the lowest level since October 2021.

Following the inflation numbers, Patrick Harker, President of the Federal Reserve Bank of Philadelphia, said it was time for future Fed rate hikes to shift to 25 basis points increments. His comments added fuel to the Greenback's decline as US yields sank.

Equity prices in Wall Street turned negative after the opening. The deterioration in market sentiment was accompanied by a rebound in US yields. The US Dollar reversed its course and rose sharply, erasing all US CPI-losses.

The GBP/USD is struggling to hold above 1.2100 as markets continue to digest CPI numbers and the Dollar keeps looking for a direction. The Pound also weakened during the last hour versus the Euro, with EUR/GBP surging to 0.8890, the highest level since late September. 

Technical levels

GBP/USD

Overview
Today last price1.2139
Today Daily Change-0.0007
Today Daily Change %-0.06
Today daily open1.2146
 
Trends
Daily SMA201.2082
Daily SMA501.1999
Daily SMA1001.168
Daily SMA2001.2005
 
Levels
Previous Daily High1.2179
Previous Daily Low1.21
Previous Weekly High1.2102
Previous Weekly Low1.1841
Previous Monthly High1.2447
Previous Monthly Low1.1992
Daily Fibonacci 38.2%1.213
Daily Fibonacci 61.8%1.2149
Daily Pivot Point S11.2105
Daily Pivot Point S21.2064
Daily Pivot Point S31.2027
Daily Pivot Point R11.2183
Daily Pivot Point R21.222
Daily Pivot Point R31.2261

Author

Matías Salord

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

More from Matías Salord
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD rebounds after falling toward 1.1700

EUR/USD gains traction and trades above 1.1730 in the American session, looking to end the week virtually unchanged. The bullish opening in Wall Street makes it difficult for the US Dollar to preserve its recovery momentum and helps the pair rebound heading into the weekend.

GBP/USD steadies below 1.3400 as traders assess BoE policy outlook

Following Thursday's volatile session, GBP/USD moves sideways below 1.3400 on Friday. Investors reassess the Bank of England's policy oıtlook after the MPC decided to cut the interest rate by 25 bps by a slim margin. Meanwhile, the improving risk mood helps the pair hold its ground.

Gold stays below $4,350, looks to post small weekly gains

Gold struggles to gather recovery momentum and stays below $4,350 in the second half of the day on Friday, as the benchmark 10-year US Treasury bond yield edges higher. Nevertheless, the precious metal remains on track to end the week with modest gains as markets gear up for the holiday season.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid bearish market conditions

Bitcoin (BTC) is edging higher, trading above $88,000 at the time of writing on Monday. Altcoins, including Ethereum (ETH) and Ripple (XRP), are following in BTC’s footsteps, experiencing relief rebounds following a volatile week.

How much can one month of soft inflation change the Fed’s mind?

One month of softer inflation data is rarely enough to shift Federal Reserve policy on its own, but in a market highly sensitive to every data point, even a single reading can reshape expectations. November’s inflation report offered a welcome sign of cooling price pressures. 

XRP rebounds amid ETF inflows and declining retail demand demand

XRP rebounds as bulls target a short-term breakout above $2.00 on Friday. XRP ETFs record the highest inflow since December 8, signaling growing institutional appetite.