As the world’s best investment manager and financial market’s journalist, I bring you the latest insights on how GBP/USD reacted to the wide miss in US data, the Bank of England’s rate cut, and upcoming economic indicators.
GBP/USD saw a last-minute boost on Friday after US Nonfarm Payrolls (NFP) fell short of expectations, causing the Greenback to weaken. Despite this, the Pound Sterling ended the week lower against the USD.
What to Expect Next Week: Focus on Data and Rate Cut Speculation
The Pound Sterling faced pressure following the BoE’s rate cut and concerns over the US economy’s slowdown. The latest US NFP data showed a lower-than-expected job creation of 114K in July, with an increase in unemployment and a slowdown in wage growth.
Investors reacted by moving away from risky assets, leading to declines in equity markets. Traders are now pricing in a rate cut by the Federal Reserve in September, with a 70% chance of a double-cut.
Next week, the US will release ISM Services PMI figures, while the UK will see BRC Retail Sales data. These releases will provide further insights into the economic health of both countries.
GBP/USD Technical Analysis
GBP/USD experienced a third consecutive down week, falling by -2.58%. The currency pair is currently trading below the 200-day EMA but struggling to break above the 50-day EMA.
GBP/USD Daily Chart
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Overall, the GBP/USD pair is facing pressure from economic data and rate cut expectations. Traders should closely monitor upcoming releases to gauge market sentiment and potential trading opportunities.