The GBP/USD pair extended its losses and approached the key psychological level of 1.2600 after the Bank of England decided to keep rates unchanged, signaling a potential easing cycle to come. Mixed UK economic data, with Retail Sales exceeding expectations but flash PMIs softening, is indicating a potential slowdown in the economy. The GBP/USD is currently trading at 1.2636, down 0.16%.
Despite strong UK Retail Sales data for May, the Pound Sterling remains under pressure as weak preliminary S&P Global/CIPS data for June weighs on the economic outlook. The Office for National Statistics reported stronger-than-expected Retail Sales growth in May, with monthly sales rebounding by 2.9% and yearly sales increasing by 1.3%. However, weak data for June is impacting the Pound’s performance against other currencies.
The GBP/USD pair is holding steady above the mid-1.2600s range during the Asian session on Friday, following a decline to a one-month low after the Bank of England decision. The pair is currently vulnerable to further retracement from a multi-month peak reached last week around the 1.2860 region. Traders are closely monitoring the situation to see if the Pound can find support and reverse its recent downtrend.
With the potential easing cycle on the horizon and mixed economic data coming out of the UK, the GBP/USD pair is facing increased volatility and uncertainty. Traders are advised to carefully watch key support and resistance levels to gauge the future direction of the pair. Market sentiment towards the Pound Sterling will likely be influenced by upcoming economic indicators and any further guidance from the Bank of England regarding monetary policy.
Overall, the GBP/USD pair is currently under pressure and approaching key support levels. Traders are advised to remain cautious and monitor developments in the UK economy and central bank policies. The pair’s direction will likely be determined by upcoming economic data releases and any further indications of easing measures from the Bank of England. Vigilance and risk management are crucial in navigating the current volatility in the GBP/USD pair.
