- GBP / USD has climbed back above 1.3850 in recent trade, a strong recovery from previous lows below 1.3780.
- Vaccine optimism continues to drive the sterling’s outperformance against its G10 currency pairs.
The GBP/USD It has climbed back above 1.3850 in recent trade, a strong recovery from European session lows initially touched at 1.3780, and the pair is now considering a test of weekly highs at 1.3866. The upside impetus in recent trade has been a broad slide in the US dollar, which prior to the start of US trading hours, had been the best performing currency on the day but is now in the middle of the performance chart of the US dollar. G10.
The British pound has replaced the USD as the best performer for the day, with GBP / USD climbing around 0.3% or around 40 pips. On the week, the British pound ranks third among the G10 currencies, up about 1.0% against the US dollar (roughly equal to the NOK and slightly behind the AUD, which was up 1.2% against the US dollar. to the US dollar for the week). There does not appear to be any specific news or updates behind the sterling outperformance and therefore market commentators are likely referring to the strong fundamental UK backdrop.
USD stumbles at the end of the week
As with the GBP, no specific news can be pinpointed as to why the US dollar faltered during US trading hours. However, things have certainly stacked against the US dollar this week; US consumer price inflation data released on Wednesday was soft (USD negative) and Fed Chairman Jerome Powell and other Fed speakers have been very subdued and eager to reassure markets that the accommodative policy is here to stay for a long time (USD negative).
Meanwhile, stocks continue to look cheerful (bad for safe havens like the USD) and commodities continue to soar amid the chatter of the commodity “supercycle” (good for commodity-linked currencies, bad for commodities). USD). Quants at JP Morgan said “We believe the last supercycle (of crude oil) peaked in 2008 (after 12 years of expansion), bottomed out in 2020 (after a 12-year contraction) and that we are probably entering a Rising Phase of a New Commodity Supercycle “.
Technical Levels
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
