The GBP/USD pair fell for a second consecutive day, trading around 1.2780 in the Asian session on Wednesday. The decline in the GBP/USD pair was attributed to the strengthening of the US Dollar (USD) following Federal Reserve Chairman Jerome Powell’s speech to the US Congress on Tuesday. Powell acknowledged improving inflation data but reiterated the Fed’s cautious stance.
Federal Reserve Chairman Jerome Powell said in a speech to Congress on Tuesday that better data will strengthen the Fed’s confidence in inflation. He also stressed that a rate cut would not be appropriate until the Fed has more confidence that inflation is on track to reach 2%. He noted that first-quarter data has not helped to boost confidence that inflation is on a track that would require the Fed to cut rates.
Traders will be watching Fed Chairman Jerome Powell’s second semi-annual address, as well as speeches by Fed Governors Michelle Bowman and Austan Goolsby on Wednesday. Additionally, U.S. Consumer Price Index (CPI) data due for release on Thursday will also be a key focus.
In the UK, Bank of England policymaker Jonathan Haskell recommended keeping interest rates at their current levels due to continuing upward pressures in the labour market. “My preference is to keep interest rates on hold until we have further confidence that underlying inflationary pressures have indeed abated,” Haskell stressed, according to Reuters.
The British pound (GBP) is showing subdued movements against major currencies as attention shifts to upcoming economic data, particularly as investors await the release of UK monthly gross domestic product (GDP) data and May manufacturing data on Thursday.
Trade recommendation: Follow the 1.2800 level and enter a long position if it bounces back and a short position if it breaks down.
Source: FreshForex
https://forexnews.pro/2024/07/10/gbpusd-struggles-amid-strengthening-of-the-us-dollar/
