The GBP/USD pair continues its downward trend, with the British Pound losing 0.10% against the US Dollar after US economic data showed inflation remaining above the Federal Reserve’s 2% goal. Headline PPI for October rose the most in four months on an annual basis, while core PPI had three consecutive months of higher readings. The GBP/USD is currently trading at 1.2692 after reaching a daily high of 1.2710.
The Pound Sterling hit a four-month low near 1.2630 against the US Dollar on Thursday as the USD continued to gain momentum. President-elect Donald Trump and the Republican Party’s control of both the US Senate and House of Representatives boosted optimism around the US economic outlook. The GBP/USD pair extended its losses for the fifth consecutive trading day due to the Dollar’s strength.
During the Asian trading hours on Thursday, the GBP/USD pair fell below 1.2700, reaching around 1.2685 as the US Dollar rallied to its highest level since November 2023. The upcoming speech by Bank of England Governor Andrew Bailey also added to the pressure on the major pair. Investors are waiting to hear Bailey’s perspective on the economic situation and its impact on the Pound.
Technical analysis shows a bearish bias for the GBP/USD pair, with the price falling below the key level of 1.2700. The downward momentum is expected to continue in the short term, as the Dollar remains strong against the Pound. Traders are advised to monitor key support levels and potential reversal points to capitalize on short-term trading opportunities.
The US economic data showing higher inflation than expected has boosted the Dollar’s performance against major currencies like the Pound Sterling. With the political landscape in the US also providing support for the Dollar, the GBP/USD pair faces further downside pressure. Investors should remain cautious and adapt their trading strategies to the evolving market conditions.
As uncertainty looms over the global economy and currency markets, the GBP/USD pair is likely to remain bearish in the near term. Traders should closely monitor economic data releases, central bank speeches, and geopolitical developments that could impact the exchange rate. With the Dollar’s strength persisting, the Pound may struggle to regain ground against the US currency in the coming days.
