- The pound remains under pressure, while the dollar gains momentum.
- Treasury yields up, support DXY.
- GBP/USD getting closer to the 2020 low.
The GBP/USD remains in negative territory and at the lowest levels in two years, near 1.1550, before a firmer dollar throughout the market. The pair hit a new two-year low after US jobless claims data at 1.1547 and then rebounded tepidly.
In minutes there will be more data from the US with the ISM manufacturing for August. On Friday it will be the turn of the official employment report for August. Figures from the weekly jobless claims report showed a drop in initial claims to eight-week lows.
Economic data continue to support expectations of another aggressive rise in interest rates by the Federal Reserve, which therefore contributes to the strength of the dollar in the market. DXY is near year highs above 109.00. A great support for the dollar is being the rise in Treasury bond yields. The 10-year tranche reached 3.26%, the highest level since June.
On the pound side, weakness persists in the face of a complicated economic outlook for the United Kingdom, further complicated by the succession of Boris Johnson. The British currency only hours ago achieved some stability, which is reflected in the decline from maximums in months of the EUR/GBP.
Should GBP/USD continue downhill, next supports loom at 1.1500, followed by 1.1470 and then March 2020 low at 1.1405. To the upside, the first major resistance appears at 1.1620 followed by 1.1650. A return above this last level would ease downward pressures.
Technical levels
Source: Fx Street
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.
