- The GBP/USD pair loses 0.12% and falls from 1.2163 to 1.2112, given the escalation of the conflict in the Middle East.
- Gold prices exceed $2,000, reflecting the greater volatility of the markets and the feeling of risk aversion.
- Upcoming economic releases in the UK and US, including PMI indices and monetary policy decisions, to provide further guidance.
GBP/USD posts minimal losses of 0.12% after reaching a daily high of 1.2163 on risk appetite, but news headlines showing an escalation of the conflict in the Middle East weighed on the pair. Therefore, the pair reversed its trading course at 1.2112, as sellers aim for a test of 1.2100.
USD/JPY reverses course from daily high as geopolitical tensions weigh on market sentiment
Volatility is the name of the game, as evidenced by Gold prices rising beyond $2,000 for the first time since May 16, 2023. News that Israel intensified its ground offensive in Gaza, destroying communications and services Internet in Palestine, according to Pallet, the Palestinian telecommunications company. Meanwhile, Israeli military authorities commented that they “have intensified attacks on Gaza. The Air Force is extensively striking underground and terrorist targets significantly.”
Reactions erupted around the world, with the United States urging Israel to stop a “full-scale” invasion and instead use a surgical approach with aircraft and special operations forces.
Aside from this, previously released US economic data shows that inflation continues to ease, but is struggling to get below the 3% threshold. The Fed’s preferred inflation gauge, the core PCE, fell from 3.8% to 3.7% year-over-year in September, while the PCE was unchanged from 3.4% in August.
Recently, the University of Michigan revealed that consumer sentiment improved slightly, but inflation expectations deteriorated. Over a one-year period, Americans expect prices to rise 4.2%, while over a five-year period, they are expected to remain at 3%.
Next week, the British economic agenda will include the S&P Global/CIPS PMIs along with the Bank of England’s monetary policy decision. In the United States, the Conference Board’s consumer confidence, S&P Global and ISM manufacturing PMIs, non-farm payrolls and the Federal Reserve’s monetary policy decision will be published.
GBP/USD Technical Levels
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.
