|

Pound Sterling advances against US Dollar ahead of US JOLTS Job Openings data

  • The Pound Sterling rises to near 1.3450 amid risks of a likely US government shutdown.
  • US Democrats want Republicans to undo cuts in the healthcare budget.
  • BoE’s Ramsden argues in favor of interest rate cuts to support weakening job demand.

The Pound Sterling (GBP) extends its upside to near 1.3450 against the US Dollar (USD) during the European trading session Tuesday. The GBP/USD pair advances as the US Dollar trades cautiously amid fears of a potential United States (US) government shutdown, with Republicans struggling to persuade Democrats to support short-term funding bill before Tuesday’s midnight deadline.

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally lower around 97.80.

Prospects of a partial US government shutdown have escalated significantly, following comments from Vice President (VP) JD Vance to CNBC, after meeting with Democrats, recognising that the administration could face a shutdown. “I think we’re headed to a shutdown because the Democrats won’t do the right thing,” Vance said.

Democrats have been denying approving the stopgap bill in the House of Senate as they want White House to roll back cuts in healthcare benefits announced earlier this year.

Meanwhile, the US Labour and Commerce departments have warned that the closure of statistical agencies, in the event of a partial shutdown, could halt the scheduled releases of key economic indicators, including official employment data for September.

Pound Sterling drops as BoE's Ramsden warns of labor market risks

  • The Pound Sterling faces slight selling pressure on Tuesday. The British currency trades marginally lower as Bank of England (BoE) Deputy Governor Dave Ramsden has argued in favor of reducing interest rates amid growing United Kingdom (UK) labor market concerns. Ramsden is also confident that inflationary pressures will return to the central bank as interest rates are still restrictive.
  • “We have seen the labour market continuing to loosen with wage growth normalising,” Ramsden said in a panel discussion organised by the European Central Bank (ECB) in Frankfurt on Monday, and added that "I [Ramsden] see that as supporting a continuation of the core disinflation process, which anchors his view on the inflation outlook," Reuters reported.
  • BoE Ramsden’s support for interest rate cuts is unfavorable for the Pound Sterling, as he was among seven of nine Monetary Policy Committee (MPC) members who voted to hold policy rates steady at 4% in the September policy meeting.
  • Meanwhile, UK Q2 Gross Domestic Product (GDP) data has come in stronger than previously estimated on an annual basis. The figures showed that the economy rose by 1.4% YoY, faster than the preliminary release of 1.2%. Quarter-on-quarter GDP growth remained in line with flash estimates of 0.3%.
  • In Tuesday’s session, the major trigger for the GBP/USD pair will be the US JOLTS Job Openings data for August, which will be published at 14:00 GMT.  US employers are expected to have posted fresh 7.1 million jobs, in line with the prior reading of 7.18 million.

Technical Analysis: Pound Sterling stays below 20-day EMA

The Pound Sterling gains marginally higher to near 1.3450 against the US Dollar on Tuesday. However, the near-term outlook for the Cable remains bearish as it stays below the 20-day Exponential Moving Average (EMA), which trades around 1.3483.

The 14-day Relative Strength Index (RSI) rebounds from 40.00, currently at 46. The pair would remain sideways if the RSI is stable in the 40.00-60.00 range.

Looking down, the August 1 low of 1.3140 will act as a key support zone. On the upside, the September 17 high of 1.3726 will act as a key barrier.

Author

Sagar Dua

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

More from Sagar Dua
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 moves sideways below 1.1800 on Christmas Eve

EUR/USD struggles to find direction and trades in a narrow channel below 1.1800 after posting gains for two consecutive days. Bond and stock markets in the US will open at the usual time and close early on Christmas Eve, allowing the trading action to remain subdued. 

GBP/USD keeps range around 1.3500 amid quiet markets

GBP/USD keeps its range trade intact at around 1.3500 on Wednesday. The Pound Sterling holds the upper hand over the US Dollar amid pre-Christmas light trading as traders move to the sidelines heading into the holiday season. 

Gold retreats from record highs, trades below $4,500

Gold retreats after setting a new record-high above $4,520 earlier in the day and trades in a tight range below $4,500 as trading volumes thin out ahead of the Christmas break. The US Dollar selling bias remains unabated on the back of dovish Fed expectations, which continues to act as a tailwind for the bullion amid persistent geopolitical risks.

Bitcoin slips below $87,000 as ETF outflows intensify, whale participation declines

Bitcoin price continues to trade around $86,770 on Wednesday, after failing to break above the $90,000 resistance. US-listed spot ETFs record an outflow of $188.64 million on Tuesday, marking the fourth consecutive day of withdrawals.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Avalanche struggles near $12 as Grayscale files updated form for ETF

Avalanche trades close to $12 by press time on Wednesday, extending the nearly 2% drop from the previous day. Grayscale filed an updated form to convert its Avalanche-focused Trust into an ETF with the US Securities and Exchange Commission.