The Pound Sterling (GBP) sees slight gains against major currencies following the release of mixed UK Employment data. The Office for National Statistics (ONS) reports strong labor demand but easing wage growth, prompting speculation of a BoE interest rate cut.
UK Unemployment Rate drops to 4.1% as employers hire 265K new workers, boosting hawkish BoE bets. However, wage growth data shows a slowdown, relieving concerns about inflation in the services sector and increasing expectations for rate cuts.
Despite Average Earnings Excluding Bonuses meeting expectations at 5.1%, overall wage growth decelerates to 4%, signaling potential easing by the BoE.
USD Inflation Data to Impact Fed Interest Rate Cut Path
- GBP/USD remains below 1.3100 resistance as the Dollar holds gains, awaiting US CPI data for rate cut guidance.
- US Dollar Index (DXY) near 101.60 as investors focus on August CPI release, influencing Fed rate cut speculation.
- Possibility of 25 or 50 bps rate cut in September varies based on CPI data and recent NFP report showing better job growth.
- US CPI expected to decelerate to 2.6%, with core inflation steady at 3.2%, impacting Fed easing decisions.
Technical Analysis: GBP/USD Hovers Near 1.3100
GBP/USD at make-or-break level near 1.3100 resistance, supported by 20-day EMA at 1.3075. RSI indicates bullish trend but momentum may pause.
Resistance levels at 1.3200 and 1.3500, with crucial support at 1.3000 for GBP bulls.
Pound Sterling FAQs
- GBP is world’s oldest currency, accounting for 12% of global FX transactions.
- BoE’s monetary policy key driver for GBP value, based on inflation targeting.
- Economic data releases and Trade Balance impact GBP strength.