GBP/USD trades below the YTD top amid modest USD strength, holds above 1.2800 – 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 trades below the YTD top amid modest USD strength, holds above 1.2800 – Crypto News

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  • GBP/USD oscillates in a narrow trading band just below the YTD peak touched on Friday.
  • Elevated US bond yields help revive USD demand and act as a headwind for the pair.
  • The prospects for more aggressive tightening by the BoE should limit any meaningful slide.

The GBP/USD pair kicks off the new week on a subdued note and consolidates its recent gains to the highest level since April 2022, around mid-1.2800s touched on Friday. Spot prices remain confined in a narrow trading band through the Asian session and currently trade near the 1.2820-1.2815 region, down just over 0.10% for the day.

The US Dollar (USD) gains some positive traction and for now, seems to have snapped a two-day losing streak to its lowest level since June 2022 touched on Friday, which, in turn, is seen acting as a headwind for the GBP/ USD pair. The prospects for further policy tightening by the Federal Reserve (Fed) later this month remain supportive of elevated US Treasury bond yields and help revive the USD demand. That said, reduced bets for any further interest rate hike by the Fed after the one expected in July might hold back bulls from placing aggressive bets around the USD.

The US NFP The report released on Friday showed that the economy added the fewest jobs in 2-1/2 years in June and suggested that labor market conditions were finally easing. This, along with signs that the inflation is gradually slowing, fueled speculations that the fed will eventually soften its hawkish stance, sooner rather than later. Apart from this, expectations that the Bank of England (BoE) will be far more aggressive in policy tightening to combat high inflation might continue to underpin the British Pound and contribute to limiting the downside for the GBP/USD pair.

Traders might also refrain from placing aggressive bets and prefer to wait on the sidelines ahead of this week’s release of the UK monthly employment details on Tuesday. This will be followed by the latest US consumer inflation figures on Wednesday, which will play a key role in influencing the near-term USD price dynamics and provide a fresh directional impetus to the GBP/USD pair. In the meantime, traders on Monday will take cues from BoE Governor Andrew Bailey’s speech for short-term opportunities in the absence of any relevant market-moving economic releases,

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