The Pound drops on weak UK employment data, to retest support area at 1.2430.
UK Unemployment rate increased to 4.2% in the three months to February against expectations of a 4% reading.
Investors’ focus is on Wednesday’s UK CPI data for more clues about the BoE’s monetary policy outlook.
The Sterling has resumed its broader bearish trend during Tuesday’s London trading session. The uninspiring UK employment figures have endorsed the theory that the BoE might start cutting rates ahead of schedule, which has punished the GBP.
The Claimant count range increased below expectations but wage growth eased to 6% YoY in the three months before February, from from 6.1% in the previous period. But above all, the unemployment rate increased to 4.2% disappointing the market that had forecasted a 4% rate, unchanged from the previous month.
The US Dollar maintains its bullish trend intact, fuelled by higher US Treasury yields. The 10-year benchmark yield is trading at year-to-date highs near 4.70%. The 2-year yield the most closely related to interest rate expectations remains pinned to the key 5% level.
Later on Tuesday BoE Governor Bailey is expected to meet the press although the highlight of the week in the UK will be Wednesday’s CPI data, which is expected to have cooled significantly. Also on Tuesday, Fed Governor, Jerome Powell is expected to participate in a panel discussion in Washington. His comments about monetary policy might have some impact on US Dollar crosses.
GBP/USD Price Analysis: Technical outlook
Bears have pushed the pair back to the bottom of the monthly descending channel, at 1.2430, which is being tested at the moment. Last Friday’s low is right below there, at 1.2430. A clear break of that support area clears the path towards 1.2370. Further down there is no support until 1.2220.
On the upside 1.2505 level should be cleared to advance towards 1.2565, where an unmitigated order block may provide a fresh boost for bears.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : FXStreet – https://www.fxstreet.com/news/gbp-usd-keeps-pushing-against-12430-support-weighed-by-weak-uk-employment-data-202404161704
