Pound Sterling clings to gains on cheerful market mood, UK inflation in focus
The post Pound Sterling clings to gains on cheerful market mood, UK inflation in focus appeared on BitcoinEthereumNews.com.
The Pound Sterling holds strength near 1.2700 as investors turn risk-averse on firm Fed rate-cut hopes. April’s UK headline inflation is expected to return to near 2%. This week, investors will focus on the UK inflation for April and the FOMC minutes. The Pound Sterling (GBP) trades close to an almost two-month high around 1.2700 in Monday’s European session. The GBP/USD pair strengthens as the US Dollar (USD) is on the back foot as financial markets remain confident that the Federal Reserve (Fed) will start lowering interest rates from the September meeting. Investor confidence in Fed rate cuts has strengthened due to a decline in the United States Consumer Price Index (CPI) data and easing labor market conditions as suggested by recent Employment and Initial Jobless Claims data. In spite of unsupportive economic indicators, Fed policymakers remain leaning towards a restrictive interest rate stance as a one-time decline in inflation is insufficient to build confidence that price pressures will sustainably return to the desired rate of 2%.Going forward, investors will focus on the Federal Open Market Committee (FOMC) minutes, which will be published on Wednesday. The FOMC minutes are expected to show that policymakers emphasized keeping interest rates restrictive for a longer period. Daily digest market movers: Pound Sterling strengthens while US Dollar is on the back foot The Pound Sterling exhibits strength near the round-level resistance of 1.2700 against the US Dollar. The GBP/USD pair remains upbeat as the appeal for risk-perceived assets has improved amid firm speculation that the Federal Reserve will start reducing interest rates from the September meeting. S&P 500 futures have posted decent gains in the European session. This week, the strength of the Pound Sterling will be tested on the grounds of the United Kingdom (UK) inflation data for April, which will be published…
Filed under: News - @ May 20, 2024 9:18 am