Pound Sterling Price News and Forecast: GBP/USD gains traction to near 1.3390 on Wednesday

FXStreet Team FXStreet

British Pound gains ground to near 1.3400 ahead of US CPI release

The GBP/USD pair trades in positive territory around 1.3390 during the early European trading hours on Wednesday. Markets might turn cautious later in the day ahead of the US May Consumer Price Index (CPI) inflation report. On Friday, the monthly UK Gross Domestic Product data will be in the spotlight.

Financial markets had expected the Bank of England (BoE) to cut interest rates twice this year to 3.25%. Since the US-Iran war began, the situation has reversed, and now a rise of 25 basis points (bpd) before December is projected, according to CNBC. Read more...

British Pound consolidates below 1.3400 vs USD amid fresh Iran tensions, ahead of US CPI

The GBP/USD pair struggles to capitalize on its recovery gains recorded over the past two days, from a three-week low, and oscillates in a narrow band during the Asian session on Wednesday. Spot prices currently trade around the 1.3365-1.3370 area, nearly unchanged for the day, as traders opt to wait for further developments surrounding the Middle East crisis and the release of the latest US consumer inflation figures.

The US military launched strikes against Iran, as ordered by US President Donald Trump, in retaliation for the shooting down of an American helicopter in the Strait of Hormuz. Adding to this, Iran's Foreign Minister Abbas Araghchi warned the US to leave the region or face consequences, and said that Iran's armed forces would not leave any attack or threat unanswered. Adding to this, the lack of progress in US-Iran negotiations tempers hopes for a peace deal and keeps geopolitical risks in play, which is seen benefiting the US Dollar's (USD) relative safe-haven status and acting as a headwind for the GBP/USD pair. Read more...

British Pound Sterling tries retail therapy, hits the usual ceiling

Sterling finally got a piece of good domestic news and managed to enjoy it for about half a session. GBP/USD rallied from just below 1.3350 to a touch above 1.3400 on Tuesday, tagged the 200-day Exponential Moving Average (EMA), and spent the rest of the day leaking back beneath the figure. The bounce was real, the rejection was cleaner, and the week's actual main event has not even happened yet.

The British Retail Consortium (BRC) reported like-for-like retail sales up 3.4% YoY in May, miles above the 0.6% consensus and a full reversal of April's 3.4% decline. It is a genuinely strong print, and also a thin one. A shop survey swinging seven points in a month says as much about base effects and calendar quirks as it does about a consumer renaissance, and the Bank of England (BoE) will not reprice policy off it. Neither did the market: the pop had fully faded within hours. Read more...

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FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

AUD/USD consolidates above 0.7000/two-month low; bearish potential intact

The AUD/USD pair oscillates in a narrow range during the Asian session, and moves little following the release of mixed inflation figures from China. Spot prices currently trade around the 0.7025 region, nearly unchanged for the day, and remain within striking distance of a nearly two-month low set on Tuesday. Renewed hostilities between the US and Iran temper hopes for a deal to end the over three-month-old war.

Japanese Yen languishes despite wholesale inflation accelerates in May

USD/JPY flatlines after experiencing volatility, trading around 160.40 during the Asian hours on Wednesday. The pair continues to hold its ground, reflecting a struggling Japanese Yen that has failed to find support despite a massive acceleration in wholesale inflation. Driven by surging energy costs linked to the ongoing Middle East conflict, Japan’s Producer Price Index jumped 6.3% year-over-year in May. This hot printing comfortably outpaced April’s upwardly revised 5.3% figure and surpassed market consensus of 5.5%, marking the fastest pace of wholesale price growth in three years.

$4,200: Gold retains bearish bias near March low ahead of US CPI

Gold recovers slightly after touching a fresh low since March 23, though it retains a bearish bias near the $4,200 mark through the early European session. Renewed hostilities between the US and Iran fuel inflationary concerns and bolster bets for more hawkish central banks, which is seen as a key factor driving flows away from the non-yielding yellow metal. Furthermore, the decline could be attributed to technical selling following the recent breakdown below the very important 200-day SMA.

Cardano's downtrend deepens despite on-chain bottoming signals

Cardano edges lower to $0.1600 signaling a potential extension of the 30% loss from last week. The altcoin remains under intense selling pressure, weighing on its retail support. Still, a spike in dormant supply re-entering circulation signals that the selling pressure has run its course, a pattern that often precedes a rebound.

US CPI data set to show inflation at three-year high in May, backing Fed hawkish tilt

The US Bureau of Labor Statistics will publish the May Consumer Price Index (CPI) data on Wednesday. The report is expected to show another step up in consumer inflation, driven by the persistently high Oil prices due to the ongoing crisis in the Middle East.

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.