GBP/USD struggles despite UK´s economy dodging a recession, post-Powell’s hawkish tone – Crypto News – Crypto News
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GBP/USD rallies sharply, above 1.1860 on mixed US/UK PMIs GBP/USD rallies sharply, above 1.1860 on mixed US/UK PMIs

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GBP/USD struggles despite UK´s economy dodging a recession, post-Powell’s hawkish tone – Crypto News

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  • GBP/USD continues its downward trend, dropping 0.16% despite the UK GDP narrowly avoiding a contraction in Q3.
  • The Bank of England’s cautious stance mirrors the Fed’s, as both central banks adopt a meeting-by-meeting approach to monetary policy.
  • Upcoming economic releases from the UK and US, including jobs, inflation, and retail data, are set to influence the pair’s trajectory next week.

GBP/USD failed to gain traction on Friday, extended its losses to five consecutive days, is down 0.16% or 20 pips from its opening price after hitting a daily high of 1.2237. At the time of writing, the pair exchanges hands at 1.2205.

Sterling dips to 1.2205, extending its losing streak amid mixed UK economic signals and a robust US Dollar

The UK’s Gross Domestic Product (GDP) for the third quarter failed to grow every month but exceeded estimates for a 0.1% contraction. On an annual basis, GDP grew by 0.6%, missing forecasts of 0.5%. Even though data portrays British dodged a recession in 2023, remains at the brisk of a stagflationary scenario, as inflation remains at higher levels, despite the Bank of England’s (BoE) efforts to curb higher prices, after more than 500 basis points of tightening.

Meantime, BoE officials delivered hawkish remarks, though adopted a meeting-by-meeting approach like the US Federal Reserve.

Across the pond, hawkish comments from Jay Powell sparked a jump in US Treasury bond yields, which underpinned the Greenback. Friday´s data revealed that Consumer Sentiment among American households deteriorated further, easing from 63.8 to 60.4. Inflation expectations rose, for one year to 4.4%, and five-year inflation is seen at 3.2%.

Meanwhile, GBP/USD traders brace for next week´s UK economic docket that will feature jobs data, inflation, and retail sales. On the US front, besides further Fed speakers, consumer, and producer inflation, along with unemployment claims and retail sales.

GBP/USD Technical Levels

 

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