- The GBP/USD falls 170 pips in the midst of speculation that the PM Starmer could replace Foreign Minister Reeves.
- The rebellion of the Labor Deputies forces changes in the Project of Welfare Law, erasing £ 5 billion in savings; The 10 -year -old Gilt yield jumps to 4.68%.
- The US ADP shows a surprising loss of -33k jobs; Trump’s tax bill faces a delay, a commercial agreement with Vietnam is announced.
The sterling pound collapses sharply, more than 1.20% or 170 pips, on Wednesday against the dollar, amid the growing speculation that Treasury Chancellor Rachel Reeves could be replaced by Prime Minister, Sir Keir Starmer. The GBP/USD quotes in 1,3575, after reaching a daily maximum of 1,3751.
The Libra sinks at 1,3575 while the rebellion within the Labor Party generates tax concerns, pushing yields to Post-Truss maximum
Political agitation is molding the cable path, since 50 Labor deputies voted against the Government’s Welfare Reform Plan, erasing almost 5 billion savings by 2030. According to Reuters, “a rebellion in his own party forced him to eliminate a clause that hardened the criteria of eligibility for the main benefit for disability, eroding all the anticipated savings of the drafts of the drafts of the bill.
The speculation that Starmer could say goodbye to Reeves sent the yields of the bonds to 10 years to 4,681%, an increase of 25 basic points, reaching its highest level since October 2022, after the mini-presumption of Liz Truss. Meanwhile, there is a growing speculation that Reeves will need to increase taxes in the autumn budget or cut the expense plans.
Apart from this, the data in the United States (USA) showed that private companies decreased hiring in -33K in June, according to the National Employment Change Report of ADP. Meanwhile, the eyes of the investors went to the approval of the “One Big Beautiful Bill” of the US president, Donald Trump.
The head of Bloomberg, “the Republicans of the House of Representatives warn about a delay in tax vote,” he revealed that the leader of a tough conservative group is raising doubts about Trump’s bill. The president of the Caucus of Freedom of the Chamber, Andy Harris, said: “We could take another week to do this well,” adding: “I don’t think it’s ready for July 4.”
The White House revealed that Trump will meet with members of the Caucus of Libertad and multiple groups of Republicans of the Chamber, according to a senior administration official.
Meanwhile, Trump announced a commercial agreement with Vietnam, under which US products could be exported with 0% tariffs, while the US imposed a 20% tariff on Vietnam’s assets and 40% of rights over re -export.
GBP/USD price forecast: technical perspective
Although the GBP/USD collapsed below the 20 -day SMA of 1,3590 and reached a minimum of six days of 1,3562, the pair recovered some land, quoting again above 1,3600. It is worth mentioning that the relative force index (RSI) fell from around 65 to 54 during the day, but the upward trend remains intact.
If the GBP/USD rises again above 1,3650, a recovery is expected towards the figure of 1,3700. Otherwise, the torque could be trapped within the figure of 1,3600 – 1,3650 in the short term.
LIBRA ESTERLINA PRICE THIS WEEK
The lower table shows the percentage of sterling pound (GBP) compared to the main currencies this week. Libra sterling was the strongest currency against pound sterling.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.45% | 0.71% | -0.37% | -0.44% | -0.51% | -0.35% | -0.78% | |
| EUR | 0.45% | 1.14% | 0.10% | -0.03% | -0.08% | 0.10% | -0.34% | |
| GBP | -0.71% | -1.14% | -1.23% | -1.16% | -1.21% | -1.04% | -1.46% | |
| JPY | 0.37% | -0.10% | 1.23% | -0.10% | -0.09% | 0.05% | -0.37% | |
| CAD | 0.44% | 0.03% | 1.16% | 0.10% | -0.10% | 0.09% | -0.33% | |
| Aud | 0.51% | 0.08% | 1.21% | 0.09% | 0.10% | 0.17% | -0.26% | |
| NZD | 0.35% | -0.10% | 1.04% | -0.05% | -0.09% | -0.17% | -0.42% | |
| CHF | 0.78% | 0.34% | 1.46% | 0.37% | 0.33% | 0.26% | 0.42% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the sterling pound from the left column and move along the horizontal line to the US dollar, the percentage change shown in the box will represent the GBP (base)/USD (quotation).
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
