GBP/USD trades higher near 1.2630 amid weaker UK Business Confidence, US data eyed


  • GBP/USD halts its losing streak while US Dollar stays calm after a recent surge.
  • IMF Managing Director Kristalina Georgieva expects policy rates to be reduced in 2024 due to a decline in inflation.
  • UK executives urge the BoE to lower interest rates as the Economic Confidence Index fell to 28 from the previous month's decline of 21.

GBP/USD rebounds after posting losses at the previous three successive sessions amid a stable US Dollar (USD). The GBP/USD pair trades higher near 1.2630 during the Asian session on Wednesday. The USD could face downward pressure again on the moderate comments by the International Monetary Fund (IMF) Managing Director Kristalina Georgieva.

In an interview with CNN on Tuesday, IMF Managing Director Georgieva expressed optimism about the US economy, advising Americans to "cheer up." She highlighted that despite a robust labor market, interest rates are expected to moderate in 2024 due to a decline in inflation. This positive outlook suggests a potential easing of economic pressures and provides a less aggressive perspective on the Federal Reserve’s (Fed) interest rate trajectory.

The US Dollar Index (DXY) could maintain its strength on enhanced US Treasury yields. The 2-year and 10-year yields on US bond coupons improved to 4.32% and 3.94%, respectively, by the press time. The signs of sluggish global growth towards the end of 2024 initially led investors to seek refuge in the USD. However, there's a shift as market players reevaluate their aggressive bets on imminent rate cuts by the Fed.

The Pound Sterling (GBP) faces selling pressure due to the negative outlook on the British economy. The Institute of Directors' Economic Confidence Index survey revealed a continued decline in optimism among British directors about the country's economy for the next 12 months, with the index dropping to 28 in December from the previous month's decline of 21. Corporate executives in the United Kingdom (UK) are urging the Bank of England (BoE) to lower interest rates promptly to provide support to the struggling economy.

S&P Global's commentary also added to the concerns, stating that UK manufacturing output contracted at an accelerated rate at the close of 2023. The Bank of England (BoE) is now highly anticipated to cut interest rates starting from May 2024, reflecting the view that the UK's economy is vulnerable to a technical recession.

Wednesday brings the US data releases, including the December ISM Manufacturing PMI, November JOLTS Job Openings, and the Federal Open Market Committee (FOMC) Minutes. In the absence of any high-impact data from the UK’s docket during the week, the market participants will observe low-impact events including December S&P Global/CIPS Composite PMI and Halifax House Prices.

GBP/USD: additional technical levels

Overview
Today last price 1.2629
Today Daily Change 0.0011
Today Daily Change % 0.09
Today daily open 1.2618
 
Trends
Daily SMA20 1.2667
Daily SMA50 1.2509
Daily SMA100 1.2449
Daily SMA200 1.2533
 
Levels
Previous Daily High 1.276
Previous Daily Low 1.2611
Previous Weekly High 1.2828
Previous Weekly Low 1.2685
Previous Monthly High 1.2828
Previous Monthly Low 1.2501
Daily Fibonacci 38.2% 1.2668
Daily Fibonacci 61.8% 1.2703
Daily Pivot Point S1 1.2566
Daily Pivot Point S2 1.2514
Daily Pivot Point S3 1.2417
Daily Pivot Point R1 1.2715
Daily Pivot Point R2 1.2812
Daily Pivot Point R3 1.2864

 

 

Share: Feed news

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


Recommended content

Editors’ Picks

EUR/USD hovers around 1.0530 after mixed US data

EUR/USD hovers around 1.0530 after mixed US data

EUR/USD bounced from a fresh 2024 low at 1.0495, but gains were modest ahead of US data releases. Initial Jobless Claims beat expectations, but wholesale-level inflation was hotter than anticipated. Demand for the US Dollar prevails despite overbought conditions. 

EUR/USD News
GBP/USD depressed around 1.2650 on relentless US Dollar buying

GBP/USD depressed around 1.2650 on relentless US Dollar buying

GBP/USD is holding losses while flirting with multi-month lows near 1.2650 in the early American session. The pair remains vulnerable amid a broadly firmer US Dollar and softer risk tone even as BoE policymakers stick to a cautious stance on policy. Speeches from Powell and Bailey are eyed. 

GBP/USD News
Gold depressed around $2,550 and at risk of falling further

Gold depressed around $2,550 and at risk of falling further

Gold consolidates at two-month lows as the prevalent demand for the US dollar overshadows that for the safe-haven metal in a risk-averse environment. Central bank leaders' speeches stand out in the American session. 

 

Gold News
Missing crypto influencer Kevin Mirshahi found dead in Montreal Park

Missing crypto influencer Kevin Mirshahi found dead in Montreal Park

Authorities report that the remains of Kevin Mirshahi, a prominent crypto influencer who was abducted in June, have been found in a Montreal park. Local police informed “The Gazette” that a passerby found the grim discovery on October 30 in Île-de-la-Visitation Park. 

Read more
Trump vs CPI

Trump vs CPI

US CPI for October was exactly in line with expectations. The headline rate of CPI rose to 2.6% YoY from 2.4% YoY in September. The core rate remained steady at 3.3%. The detail of the report shows that the shelter index rose by 0.4% on the month, which accounted for 50% of the increase in all items on a monthly basis. 

Read more
Best Forex Brokers with Low Spreads

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.

Read More

Forex MAJORS

Cryptocurrencies

Signatures