The GBP Fundamental Overview
The GBP is off to a strong start in the upcoming business week. Notwithstanding reversing most of its gains lately. The GBP stays near to 5-week peaks versus the US dollar.
However, most of this surprising energy is due to broad greenback weakening. The rates are expected to fall in the USA following the Fed’s Sept meeting.
Also, there’s several UK-specific forces at work. Growth in the economy has come as an unexpected bonus. Showing that the nation has emerged from an economic downturn that was much quicker and milder than expected.
Furthermore, some obvious resiliency in British wage increases has made investors less sure that the BoE would be prepared to lower its own interest rate in the months to come. Higher salaries typically lead to greater inflation overall.
Fundamental View & Analysis
Keeping this into thoughts, the next week’s key planned trade signal for the GBP portion of GBPUSD will come from officially British CPI numbers.
The April numbers are scheduled for release revealed on Wed. The March aggregate inflation rate of 3.2 percent formed the smallest as the year 202. Which formed a component of a definite slowing trend that began in the latter part of 2022. If this pattern continues, Pound is expected to weaken as rate-cutting predictions rise afresh. Upward surprise will simply result in more profits.
The remaining publications in the next week shall be heavily influenced by those from the United States. There will be several notable presenters, namely Fed’s Powell with the Secretary of the Treasury Yellen. Additionally, there is also certain top figures, such as US durable goods data & the U o M ‘s consumer trust survey.
Should rates variance projections remain intact, GBP might have an additional great week. Nevertheless, assuming that Britain’s recent trajectory towards lower inflation persists. Next week this week’s projection is gloomy, albeit perhaps not very gloomy.
GBPUSD Technical Forecast
Source: TradingView- Daily Graph
The GBPUSD has risen over its 20 & 200 D-MA, in addition to the prior decline level since those March 8th tops.
The currency pair is currently back inside the wide moving range. Which existed within March 21st & the 12th of April within 1.25913 level as well as 1.27078 mark.
Pound bullish will need to push harder to hold their lead over psychological support located around 1.2600 mark. Given that there is no visible solid backing above that level at the moment. However, reversal support around 1.24870, as well as security in the middle 1.25 zone a few weeks ago. That appears to be extremely robust. The last one appears likely to be challenged shortly assuming markets fail to gather momentum nearer to present values.
