GBP/USD saw a modest increase on Monday, potentially due to improved risk appetite. The Pound Sterling received a boost after the release of higher-than-expected UK GDP figures, showing a growth of 0.6% in Q1. However, comments from BoE’s Chief Economist Huw Pill about potential rate cuts in the near future created some uncertainty for the currency.
Market participants are now looking forward to the UK employment data scheduled to be released on Tuesday, which could impact the Pound’s performance. Expectations are for an increase in Claimant Count Change and the ILO Unemployment Rate, indicating a rise in jobless claims in April.
In the US, investors will focus on key economic indicators such as the CPI, PPI, and Retail Sales for potential market drivers this week. The US Dollar faced challenges last week following the release of the University of Michigan consumer sentiment index, which dropped to a six-month low of 67.4 in May.
Despite the negative sentiment, the US Dollar might have found some support from an increase in inflation expectations for the year ahead, with readings at their highest levels in six months. This uptick in inflation indicators may have helped to boost US Treasury yields and potentially provide a foundation for the Greenback.
Overall, the movement of GBP/USD on Monday was influenced by a combination of factors, including UK economic data, comments from BoE officials, and US consumer sentiment. Market participants will continue to monitor upcoming economic releases for further insights into the future performance of both currencies.
