- GBP/USD has resumed its north-side journey as the USD Index has sensed barricades after a less-confident recovery.
- Easing US labor market conditions have faltered expectations of more interest rate hikes from the Fed.
- Higher earnings and upbeat UK Employment would put more pressure on the BoE ahead.
The GBP/USD pair has resumed its upside journey towards the round-level resistance of 1.2600 after a small intervention around 1.2560 in the early London session. Sheer strength in the Cable has been built due to a significant decline in the US Dollar Index (DXY).
S&P500 futures have increased losses in Europe amid a mild caution in the market sentiment as investors are awaiting the release of the United States Consumer Price Index (CPI) (May), which will release on Tuesday.
The USD Index is facing stiff barricades around 103.41 after a less-confident pullback move made after printing a low of 103.30. Investors are dumping positions in the US Dollar after US weekly jobless claims jumped significantly by 28K to 261K for the week ending June 02 vs. upwardly revised expectations of 235K. A 19-month high US Initial Jobless Claims release shows that labor market conditions are not tight enough and the Federal Reserve (Fed) could consider a pause in the policy-tightening spell actively.
For further guidance, US inflation data will be keenly watched. Headline inflation is seen softening to 4.2% vs. the prior release of 4.9%. Core CPI that strips of oil and food prices is expected to accelerate marginal to 5.6% vs. the former release of 5.5%. If core inflation continues to remain persistent, Fed chair Jerome Powell could be more favorable for the continuation of the policy-tightening spell.
Meanwhile, the Pound Sterling would also remain on tenterhooks amid the release of Tuesday’s Employment data (May). As per the preliminary report, Claimant Count Change is expected to drop by 9.6K against a significant increase of 46.7K. The Unemployment Rate is expected to increase to 4.0% vs. the prior release of 3.9%.
Apart from that, three-month Average Earnings excluding bonuses (April) will be keenly watched. The economic data is expected to accelerate to 7.0% vs. the former release of 6.7%. Households equipping higher liquidity for disposal would propel the overall demand and eventually inflationary pressures, which would put more pressure on the Bank of England (BoE) ahead.
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
Gold gives away some gains, slips back to $2,980
Gold retraced from its earlier all-time highs above the key $3,000 mark on Friday, finding a footing around $2,980 per troy ounce. Profit-taking, rising US yields, and a shift to a risk-on environment seem to be putting the brakes on further gains for the metal.
EUR/USD remains firm and near the 1.0900 barrier
EUR/USD is finding its footing and trading comfortably in positive territory as the week wraps up, shaking off two consecutive daily pullbacks and setting its sights back on the pivotal 1.0900 mark—and beyond.
GBP/USD remains depressed, treads water in the low-1.2900s
GBP/USD is holding steady in consolidation territory after Friday’s opening bell on Wall Street, hovering in the low-1.2900 range. This resilience comes despite disappointing UK data and persistent selling pressure on the USD.
Crypto Today: BNB, OKB, BGB tokens rally as BTC, Shiba Inu and Chainlink lead market rebound
Cryptocurrencies sector rose by 0.13% in early European trading on Friday, adding $352 million in aggregate valuation. With BNB, OKB and BGB attracting demand amid intense market volatility, the exchange-based native tokens sector added $1.9 billion.
Week ahead – Central banks in focus amid trade war turmoil
Fed decides on policy amid recession fears. Yen traders lock gaze on BoJ for hike signals. SNB seen cutting interest rates by another 25bps. BoE to stand pat after February’s dovish cut.
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.