The GBPUSD exchange rate moved above resistance on Tuesday as markets brace for UK jobs data.
GBPUSD – Daily Chart
The price of GBPUSD has moved above the recent resistance at 1.3577 and this will be the key level to watch around the jobs data.
Traders have been anticipating the UK government’s Autumn budget which has been pushed back to the end of November. That will limit the bad news for the pound in the coming weeks and there is a chance to recover further from the recent downturn.
The latest employment release will show quarterly job additions into July and will be compared to a 239k number previously. The unemployment rate is expected to remain the same. Anything lower could see the pound surrender its recent gains.
The employment data will be released at 2pm HKT on Tuesday.
That will come ahead of the country’s consumer price inflation numbers at the same time on Wednesday. Analysts are expecting a reading of 0.3% up from 0.1% in July.
The British currency is maybe benefiting from ongoing dollar weakness, rather than its own underlying strength. It will be a big week for the U.S. dollar with the FOMC interest rate decision ahead later in the week.
U.S. President Donald Trump renewed his desire for a large interest rate cut, adding pressure to the central bank a day before the policy meeting begins. In a social media post, Trump said that Fed Chair Jerome Powell “must cut interest rates, now, and bigger than he had in mind”.
Trump has repeatedly referred to Powell as “too late” after he failed to lower interest rates substantially during Trump’s term. The arrival of the President’s tariffs were a key factor in keeping rates unchanged.
