- GBP/USD printed a new two-day low around 1.2323, though stabilized around 1.2370s, but stayed negative in the day.
- Money market futures expect the Bank of England would hike 50 bps at its next meeting.
- US economic docket would be busy, though, featuring GDP, unemployment claims, and the Fed’s preferred inflation gauge.
The Pound Sterling (GBP) is retreating after hitting a seven-month high at 1.2447, though it lacked the strength to hold to the 1.2400 figure and is meandering in the 1.2380s area. At the time of writing, the GBP/USD exchanges hands at 1.2375, below its opening price by a minimal margin.
US Dollar climbs underpinned by high US Treasury yields
Sentiment remains upbeat, as shown by Wall Street’s trading in the green. Factors like a steady US Dollar and US Treasury bond yields holding to its gains weigh the GBP/USD pair. The lack of US and UK economic data keeps investors leaning on last week’s news and expectations for interest rate hikes.
Last week’s UK’s Consumer Price Index (CPI) report, with inflation staying at 10.5% though eased from 10.7% of its last month’s previous reading. That increased the likelihood of a 50 bps rate hike by the Bank of England (BoE), which according to Reuters, stand at a 70% chance, while a 25 bps rate lift is fully priced in.
In the meantime, National Grid has asked some UK households to cut energy use today and is likely to extend that request to tomorrow due to a drop in wind power coupled with freezing temperatures across the nation.
On the US front, Fed officials entered its blackout period so that traders would lean on the current week’s economic calendar. The US docket will feature Gross Domestic Product (GDP) results for Q4 with around 2.6% QoQ estimates. Also, Flash PMIs, Unemployment Claims, Durable Good Orders, and the Fed’s favorite gauge for inflation, Personal Consumption Expenditures (PCE), would provide fresh impetus to Gold traders.
GBP/USD Key Technical Levels
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.
Recommended content
Editors’ Picks
AUD/USD: Momentum favours further gains
In line with the broad recovery in the risk-linked complex, AUD/USD left behind a two-day negative streak and resumed its uptrend towards the 0.6400 region, always on the back of the resurgence of quite a strong downside pressure hitting the US Dollar on Thursday.
EUR/USD: Extra advances appear in the pipeline
EUR/USD followed the widespread improved sentiment in the risk-linked galaxy and managed to set aside two daily drops in a row and refocus on the upper end of its recent range around the 1.1400 zone on Thursday.
Gold price climbs past $3,300 on uncertainty about trade and weak USD
Gold snaps two-day losing streak, gaining 1.5% on fresh trade war fears. Trump softens tariff talk, but China denies negotiations and demands full rollback. Fed rate cut bets rise as yields drop and economic uncertainty builds.
Ondo Finance hits $3B market cap as CEO Nathan Allman meets SEC to discuss tokenized US securities
Ondo Finance met with officials of the SEC and the law firm Davis Polk to discuss the regulation of tokenized US securities. Topics included registration requirements, broker-dealer rules and proposed compliant models for tokenized securities issuance.
Five fundamentals for the week: Traders confront the trade war, important surveys, key Fed speech Premium
Will the US strike a trade deal with Japan? That would be positive progress. However, recent developments are not that positive, and there's only one certainty: headlines will dominate markets. Fresh US economic data is also of interest.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.