Pound Sterling Price News and Forecast: GBP/USD could test sub-1.3200 levels/200-day SMA

FXStreet Team FXStreet

GBP/USD Forecast: Could test sub-1.3200 levels/200-day SMA; focus shifts to Fed’s Powell

The GBP/USD pair attracts heavy selling during the early part of the European session on Tuesday and drops to mid-1.3200s, or its lowest level since early August, in reaction to the disappointing UK labor market report. Data published by the Office for National Statistics (ONS) showed that the UK ILO Unemployment Rate edged up to 4.8% in the three months to August, compared to 4.7% recorded in the previous month and consensus estimates. Further details revealed that the number of people claiming jobless benefits rose 25.8K in September, against a revised fall of 2.0K in August.

Meanwhile, Average Earnings, including Bonus, increased by 5.0% during the quarter through August, beating expectations and the previous reading of 4.7%. That said, regular pay growth, excluding Bonus, eased to 4.7% during the reported period, down slightly from 4.8% previously and marking the weakest pace since March–May 2022. The data fuels speculations that the Bank of England (BoE) could continue cutting interest rates gradually and weighs heavily on the British Pound (GBP). This, along with renewed US Dollar (USD) buying, is seen exerting pressure on the GBP/USD pair. Read more...

GBP/USD is under pressure after labour data

GBP/USD is diving toward the two-month low of 1.3260 following the release of disappointing UK labor market figures. The unemployment rate unexpectedly rose to 4.8% in the three months to August, up from 4.7% in the previous quarter, while employment levels declined, adding pressure to the British pound.

The pair is nearing a medium-term ascending trendline, which may act as a support level. A potential rebound from this area could shift attention toward the 23.6% Fibonacci retracement level at 1.3370, followed by resistance at the mid-level of the Bollinger Band and the 50-day simple moving average (SMA) in the 1.3435–1.3475 zone. Read more...

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FXStreet Team

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