The GBP/USD pair surged during the North American trading session following Federal Reserve Chair Jerome Powell’s indication of potential interest rate cuts. This move propelled the pair to its highest level in two years, trading above 1.3200 and gaining over 1%.
GBP/USD Hits New Two-Year Highs Above 1.3200
In his Jackson Hole speech, Powell emphasized the need for policy adjustments, stating that rate cuts would be based on data. He expressed confidence in inflation returning to the central bank’s target of 2%, while noting upside risks in employment.
Market expectations for a September rate cut were reflected in the US Dollar Index (DXY) dropping 0.80% to 100.71 and the US 10-year Treasury yield falling to 3.81%.
GBP/USD Price Forecast: Technical Outlook
Technically, the GBP/USD uptrend remains strong, with buyers maintaining control. The Relative Strength Index (RSI) indicates overbought conditions but suggests further upside potential.
Resistance levels for GBP/USD are at 1.3200, 1.3230, 1.3250, and 1.3300. Support levels are at 1.3100, 1.3045, and 1.3000.
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world, with key trading pairs like GBP/USD, GBP/JPY, and EUR/GBP. The value of GBP is influenced by UK monetary policy, economic data releases, and the Trade Balance indicator.
Overall, Powell’s comments on potential rate cuts led to the GBP/USD pair surging to two-year highs, with further upside potential based on technical analysis. Understanding these factors can help individuals make informed decisions about their finances and investments.