GBP/USD aims to regain 1.2200 on softer US Dollar ahead of US CB Consumer Confidence – Crypto News – Crypto News
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GBP/USD aims to regain 1.2200 on softer US Dollar ahead of US CB Consumer Confidence – Crypto News

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  • GBP/USD picks up bids to extend the previous day’s rebound from three-week low.
  • US Treasury bond yields allow USD to regain upside momentum.
  • Pessimism surrounding the UK workers’ strike, cautious mood ahead of the key US data probes Cable buyers.

GBP/USD extends the previous day’s rebound from a three-week low, up 0.11% intraday near 1.2190 during the mid-Asian session on Wednesday. In doing so, the cables The pair cheers the broad-based US Dollar weakness, due to the receding fears of the recession. However, the cautious mood ahead of key US data and challenges to the UK’s health sector seems to probe the pair buyers of late.

“Around 100,000 nurses went on strike on Tuesday for the second time in a week as their union issued an ultimatum to the government to respond to pay demands within 48 hours or face another round of industrial action in January,” said Reuters.

Elsewhere, the US Dollar Index (DXY) dropped the most in a week the previous day, down 0.67% intraday to 103.95, as the greenback traders feared less Japanese bond-buying from the US due to the BOJ action. It’s worth noting that Japan is the biggest holder of the US Treasury. bonds and the latest move allows Tokyo to put more funds into the nation than letting it flow outside. That said, the 10-year counterpart rose more than the two-year ones and hence reduced the yield curve inversion that suggests the odds of the recession.

It should be noted that the downbeat US housing data also allowed the GBP/USD pair to remain firmer, before the latest softer run-up.

Talking about the data, US Housing Starts declined by 0.5% MoM in November following October’s 2.1% contraction while Building Permits fell by 11.2% versus a 3.3% drop recorded in the previous month. Further, the German Producer Price Index (PPI) for November dropped to -3.9% YoY versus -2.6% market forecasts and -4.2% prior.

While portraying the mood, the US 10-year Treasury yields grind near a three-week high of 3.69% while the two-year bond coupons stay firmer around 4.26% by the press time. Further, Wall Street closed in green and allowed shares in the Asia-Pacific bloc to print mild gains of late.

Looking forward, the United States Conference Board (CB) Consumer Confidence figures for December, expected at 101.00 versus 100.00 prior, will join the political updates from the UK to direct short-term GBP/USD moves. Though, major attention will be given to Thursday’s UK Gross Domestic Product (GDP) figures and Friday’s US Core PCE Inflation data for clear directions.

technical analysis

The 21-day EMA joins a one-month-old ascending support line to restrict short-term GBP/USD downside near 1.2160. However, bearish MACD signals and steady RSI challenges the pair buyers.

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