- GBP/USD holds positive ground around 1.2790 amid the firmer USD on Thursday.
- The ISM said on Wednesday that its US Services PMI rebounded to 53.8% in May from 49.4% in April.
- The UK S&P Global Services PMI reached a six-month low of 52.9 from 55.0 in April.
The GBP/USD pair resumes upside near 1.2790 despite the rebound of US Dollar (USD). Traders started to price in two interest rate cuts by the Federal Reserve (Fed) this year as the US economy grew at a slower pace in the first quarter than projected earlier. Later on Thursday, the US weekly Initial Jobless Claims and Balance of Trade will be published.
In the past few months, Fed officials emphasized the need to hold the rate higher for longer until the central bank gains confidence that inflation is moving toward the Fed’s 2% target. However, the downbeat US May ISM Manufacturing PMI report and weaker Q1 Gross Domestic Product (GDP) data have triggered the expectation of easing policy from the Fed in September, which weighs on the Greenback broadly. The markets are now pricing in a nearly 70% chance of a Fed rate cut in September, up from 54.9% at the beginning of the week, according to the CME FedWatch tool.
The Institute for Supply Management (ISM) reported on Wednesday that the US Services PMI improved to 53.8 in May from 49.4 in April. This figure came in better than the estimation of 50.8.
On the other hand, the UK services sector reported slower growth in May. The UK S&P Global Services PMI reached a six-month low of 52.9 from 55.0 in April, in line with the expectation. Meanwhile, the Composite PMI dropped to a two-month low of 53.0 in May from a one-year high of 54.1 in April. Amid the absence of the top-tier UK economic data releases, the GBP/USD pair will be influenced by the USD.
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 hung out to dry on familiar low end
AUD/USD tried and failed to spark a bull run during the first trading session of 2025, rising on thin volumes before collapsing back into the 0.6200 handle in the later hours of the day. A broad-market push into the safe haven Greenback kept the Aussie pair on the defensive, and the AUD is mired in congestion on the weak side of two-year lows.
USD/JPY flirts with multi-month highs in the 158.00 region
The USD/JPY pair traded as high as 157.84 on Thursday, nearing the December multi-month high of 158.07. Additional gains are on the docket amid prevalent risk aversion.
Gold flat lines above $2,650 ahead of US PMI release
Gold price consolidates its gains near $2,660 after reaching a two-week high during the early Asian session on Friday. The safe-haven flows amid the geopolitical tensions provide some support to the precious metal.
Could XRP surge to new highs in January 2025? First two days of trading suggest an upside bias
Ripple's XRP is up 7% on Thursday, extending its rally that began during the New Year's Day celebration. If long-term holders continue their recent accumulation, XRP could overcome the $2.9 resistance level and aim for a new all-time high.
Three Fundamentals: Year-end flows, Jobless Claims and ISM Manufacturing PMI stand out Premium
Money managers may adjust their portfolios ahead of the year-end. Weekly US Jobless Claims serve as the first meaningful release in 2025. The ISM Manufacturing PMI provides an initial indication ahead of Nonfarm Payrolls.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.