- GBP/USD has climbed to 1.2177 as risk-on impulse returns confidently to the FX domain.
- The DXY is likely to remain uncertain ahead of the US NFP data.
- Investors are hoping for a 25 bps rate hike by the BOE.
The GBP/USD pair has surpassed the immediate hurdle of 1.2172 as investors have ignored the US-China tensions and have returned to risk-perceived currencies. The cable picked significant bids below 1.2140 and displayed a vertical upside move. The asset has printed an intraday high of 1.2175 and is likely to extend gains.
Earlier, the risk-sensitive currencies were underperforming as escalating Sino-US tensions improved the safe-haven appeal. Also, a pullback move in the DXY was highly expected. The DXY is likely to entertain short-term investors ahead of the US Nonfarm Payrolls (NFP) data, which is due on Friday.
The employment data is likely to remain downbeat as the market participants are expecting a downward shift in the employment generation to 250k than the prior release of 372k. Also, the Unemployment Rate is expected to remain unchanged at 3.6%. Investors should be aware of the fact that the US economy is operating on full-employment levels and a prolonged increment in job creation at an increasing rate cannot sustain. However, a satisfactory jump should be expected.
On the UK front, investors are hoping for a rate hike by the Bank of England (BOE) in its monetary policy meeting on Thursday. BOE Governor Andrew Bailey is expected to hike the interest rate by 25 basis points (bps). Considering the inflation rate at 9.4%, a rate hike by 25 bps is unable to offset price pressures. However, the downbeat economic indicators and political instability are restricting the BOE to go all in unhesitatingly.
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
EUR/USD trades on the back foot near 1.0600
EUR/USD is trading near 1.0600 in Tuesday's European trading hours, finding fresh sellers amid a pause in the US Dollar corrective decline. The pair remains cautious amid increased dovish ECB rate cut bets and geopolitical risks. ECB and Fed policymakers' speeches eyed.
GBP/USD struggles below 1.2700, awaits Bailey's testimony
GBP/USD struggles below 1.2700 in European trading on Tuesday, lacking a bullish conviction amid a steady US Dollar and as investors opt to wait for the Bank of England's (BoE) Monetary Policy Report Hearings before placing aggressive directional bets.
Gold price consolidates intraday gains to one-week high amid mixed cues
Gold price (XAU/USD) trims a part of its modest intraday gains to a one-week top and trades around the $2,620 level during the first half of the European session on Tuesday, still up for the second straight day.
Canada CPI expected to rise 1.9% in October, bolstering BoC to further ease policy
The Canadian Consumer Price Index is seen ticking higher by 1.9% YoY in October. The Bank of Canada has reduced its policy rate by 125 basis points so far this year. The Canadian Dollar navigates multi-year lows against its American counterpart.
The week ahead: Powell stumps the US stock rally as Bitcoin surges, as we wait Nvidia earnings, UK CPI
The mood music is shifting for the Trump trade. Stocks fell sharply at the end of last week, led by big tech. The S&P 500 was down by more than 2% last week, its weakest performance in 2 months, while the Nasdaq was lower by 3%. The market has now given back half of the post-Trump election win gains.
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.