- The US CPI does not meet the forecasts; The most soft general and underlying inflation reinforce the case for two FED cuts in 2025.
- The United Kingdom labor market cools as salary growth slows down to 5.6%, the lowest since November 2024, relieving pressure on the BOE.
- The policy gap between the Fed and the BOE narrows; The GBP/USD relies on a weaker dollar and stable expectations of the BOE.
The sterling pound recovered from Monday’s losses and rose more than 0.35% against the dollar after the last inflation report in the United States (USA) that maintained the hopes of the high traders for greater relief by the Federal Reserve. The GBP/USD is quoted at 1,3226 after bouncing from a daily minimum of 1,3165.
Libra rises 0.35% after inflation in the most expected US revive the hopes of relief; The United Kingdom’s labor data indicates caution of the BOE
The US Consumer Price Index (CPI) in April was slightly below estimates in the monthly general and underlying data. The CPI stood at 0.2%below the forecasts of 0.3%, but a little higher compared to the March -0.1%figure. The underlying IPC remained at 0.2%, above 0.1%but below 0.3%forecasts.
At the same time, inflation increased a 2.3% year -on -year, a tenth below the estimates and reading of the previous month, and the underlying indicators were 2.8% year -on -year. Most analysts estimated that the April figure could reflect the impact of tariffs. Even so, “larger increases are on their way” for inflation, according to Bank of America economists.
On the other side of the Atlantic, the latest employment figures in the United Kingdom showed that the labor market cools even more, a relief for the Bank of England (BOE). The number of employees fell in almost 33k, while salary growth in the three months to March increased 5.6%, the slowest since November 2024.
The chief economist of the BOE, Hew Pill, crossed the lines. He affirmed that he is still concerned about a re-beaten of inflation, since he sees second round effects. He is still the most Hawkish member, after last week he voted against the reduction of a quarter of the BOE.
The divergence of the central banks will boost the GBP/USD
Meanwhile, market participants have discounted two interest rate cuts by the Federal Reserve (FED) instead of three, according to the data last week of the Chicago Commerce Board (CBOT). At the time of writing, the Futures Contract of the FED Fund rate of December 2025 shows 54 basic relief points.
For the BOE, the swap market is discounting a total of 48.6 basic points for the end of the year, without changes in the policy expected at the next BOE meeting in June.
GBP/USD pricing: Technical Perspectives
The gBP/USD bullish trend remains intact despite retreating below the simple mobile average (SMA) of 20 days in 1,3301, which now serves as the next level of potential resistance. In the short term, the impulse has changed positively, as indicated by the relative force index (RSI). Therefore, the pair could extend its profits.
The first resistance is the 20 -day SMA. Although it has been overcome, buyers must clear it, followed by 1,3350. Then 1,3400 is located. On the contrary, if the GBP/USD remains below 1,3301, the vendors could remain hopeful to test the minimum of the current week of 1,3194, before the 50 -day SMA in 1,3089.
LIBRA ESTERLINA PRICE THIS WEEK
The lower table shows the percentage of sterling pound (GBP) compared to the main currencies this week. Libra sterling was the strongest currency against the Japanese and in Japanese.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.72% | 0.29% | 1.08% | 0.56% | -0.68% | -0.07% | 0.84% | |
| EUR | -0.72% | -0.30% | 0.91% | 0.33% | -0.75% | -0.31% | 0.60% | |
| GBP | -0.29% | 0.30% | 1.37% | 0.63% | -0.45% | -0.08% | 0.91% | |
| JPY | -1.08% | -0.91% | -1.37% | -0.52% | -2.34% | -1.97% | -0.45% | |
| CAD | -0.56% | -0.33% | -0.63% | 0.52% | -0.97% | -0.63% | 0.28% | |
| Aud | 0.68% | 0.75% | 0.45% | 2.34% | 0.97% | 0.35% | 1.34% | |
| NZD | 0.07% | 0.31% | 0.08% | 1.97% | 0.63% | -0.35% | 0.89% | |
| CHF | -0.84% | -0.60% | -0.91% | 0.45% | -0.28% | -1.34% | -0.89% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the sterling pound from the left column and move along the horizontal line to the US dollar, the percentage change shown in the box will represent the GBP (base)/USD (quotation).
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.
