- The GBP/USD is rejected from 1,3300 once again while the markets are stabilized on Wednesday.
- The impulse of the market in general took a break in the middle of the week, restricting volatility.
- The GDP growth figures of the United Kingdom and US IPP inflation are the next on the agenda for Thursday.
The GBP/USD cut the recent profits on Wednesday, going back to the low side of the 1,3300 zone and falling again to a short -term erratic consolidation phase while investors prepare for the double key data event on Thursday both in the United Kingdom (UK) and the United States (US).
The first thing on Thursday’s agenda will be the figures of the Gross Domestic Product (GDP) of the United Kingdom for the first quarter. It is expected that the GDP of the United Kingdom of the first quarter to offer a mixed fact, with an intertrimestral growth that is expected to increase, but the annualized GDP that falls slightly as a fall in internal economic activity is located at the lower end of the curve. The GDP of the first quarter is expected to rise to 0.6% intertrmetral from 0.1%, while the GDP of the first quarter is expected to be softened to 1.2% interannual from 1.5% of the fourth quarter of 2024.
The US market session will continue with the inflation of the US Production Price Index (IPP). It is expected that the underlying IP inflation drops to 3.1% interannual from 3.3%. The decrease in inflationary pressures is something positive, but the markets are increasingly concerned about tariff impacts, which will begin to leak in general economic data as soon as in May.
GBP/USD price forecast
On Thursday, cable offers continued to mark a new congestion phase, with the GBP/USD prepared for a prolonged battle near the 1,3300 zone. The price action has been in an erratic phase since it retreated from the recent maximums about 1,3450, but the bearish impulse has been fighting to drag the offers back to the 50 -day exponential mobile average (EMA) about 1,3100.
GBP/USD daily graphics
LIBRA ESTERLINA FAQS
The sterling pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most commercialized currency exchange unit (FX) in the world, representing 12% of all transactions, with an average of $ 630 billion a day, according to data from 2022. Its key commercial peers are GBP/USD, which represents 11% of FX, GBP/JPY (3%) and EUR/GBP (2%). The sterling pound is issued by the Bank of England (BOE).
The most important factor that influences the value of sterling pound is the monetary policy decided by the Bank of England. The Bank of England bases its decisions itself has achieved its main objective of “price stability”: a constant inflation rate of around 2%. Its main tool to achieve this is the adjustment of interest rates. When inflation is too high, the Bank of England will try to control it by raising interest rates, which makes access to credit for people and companies more expensive. This is generally positive for sterling pound, since higher interest rates make the United Kingdom a more attractive place for global investors to invest their money. When inflation falls too much it is a sign that economic growth is slowing down. In this scenario, the Bank of England will consider lowering interest rates to reduce credit, so that companies will borrow more to invest in projects that generate growth.
Published data measure the health of the economy and can affect the value of sterling pound. Indicators such as GDP, manufacturing and services PMI and employment can influence the direction of the sterling pound.
Another important fact that is published and affects the pound sterling is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will benefit exclusively from the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
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.
