GBP/USD is close to its weekly high again, around 1,2000, after the mixed US data.

• GBP/USD increases its intraday gains and rally near the weekly high in the last hour.
• Bullish UK GDP data continues to support GBP and extends support for the pair.
• The mixed US NFP report weighs on the USD and provides additional momentum.

The pair GBP/USD receives new offers during the early hours of the American session and jumps to the 1.2035-1.2040 zone, approaching the weekly high again in reaction to the mixed US monthly jobs data.

NFP’s headline figure showed the US economy added 311,000 new jobs in February, far exceeding consensus estimates of a reading of 205,000. However, this marks a sharp slowdown in economic activity. However, this signals a sharp slowdown from the previous month’s downwardly revised reading of 504,000. In addition, the unemployment rate rose unexpectedly to 3.6% from 3.4%, and wages also missed market estimates, rising 0.2% per month and 4.6% year-on-year.

The data also points to a weakening in the US labor market and forces investors to reduce their bets in favor of a 50 basis point rate hike at the next FOMC meeting on March 21-21, which is evident in a further decline in yields on US Treasury bonds. Apart from this, a good recovery in US equity futures weighs heavily on the safe haven US USD, which, in turn, helps the GBP/USD pair build on its strong intraday gains.

Elsewhere, the British pound continues to receive support from the UK’s monthly GDP figures, which came in better than expected and showed the economy growing by 0.3% in January. This indicates that the UK economy is holding up, which could allow the Bank of England (BoE) to raise interest rates again later this month. This is seen as another factor driving the GBP/USD pair and supporting prospects for further gains.

Technical levels to watch