- The US IPP is slowed to 2.3% year -on -year, reviving speculation about FED cuts in July.
- Trump supposedly considers the president of the Fed, which adds volatility to the market.
- The IPC of the United Kingdom jumps at 3.6% year -on -year, the highest since January 2024, reducing the probabilities of BOE cuts.
The GBP/USD reverses its course and recovers as the last production price index (IPP) of the US revives the hopes of a rate cut by the Fed, while the headlines suggest that Trump could say goodbye to the president of the Fed, Powell. At the same time, inflation on the consumer side in the United Kingdom surprised investors, exceeding forecasts. At the time of writing, the PAR is quoted at 1,3454, rising 0.55%.
The cable jumps 0.55% to 1,3454 in the midst of weaker factory prices in the US and the speculation that Trump could fire the president of the Fed, Powell
The production price index (IPP) in the US showed that factory prices remained unchanged in June, although the prices of producing goods rose 0.3% month by month. The IPP fell from 2.6% to 2.3% year -on -year, below the 2.5% forecasts. The underlying prices fell, from 3%to 2.6%, which is below the estimates of 2.7%.
Sources cited by Reuters revealed that “the threat of inflation is alive and is very real, and if this does not rule out a feat cut of the Fed in July, then nothing will do it.” At the next meeting, the Fed is expected to keep the rates without changes in the 4.25%-4.50%range, with probabilities of 96.9%.
Meanwhile, US president Donald Trump allegedly questioned Republican legislators if he should fire Fed President Jerome Powell, CBS revealed, citing Fuentes.
Bloomberg revealed that Trump will probably say goodbye to the president of the Fed soon, according to White House sources.
On the other side of the Atlantic, the inflation of Great Britain registered its highest figure since January 2024, since the CPI reached 3.6% year -on -year, which reduces the expectations of rates cuts by the Bank of England. The consensus awaited an increase to 3.4%. In addition, the underlying IPC has also increased, reaching 3.7% year -on -year, exceeding estimates and 3.5% in May.
Although the data should end the expectations of rates cuts, investors had already valued at 80% the possibility of a 25 basic points cut in August.
GBP/USD price forecast: technical perspective
The GBP/USD maintains an upward trend, found support in the minimum of June 23, 1,3369, with sellers unable to push prices decisively below to test the level of 1,3350. The bullish impulse is increasing by Trump’s comments, as shown in the relative force index (RSI).
If the GBP/USD remains above 1,3400, a 50 -day SMA test is expected in 1,3495 in the short term. The additional resistance is found in 1,3500 and in the 20 -day SMA in 1,3581. On the other hand, if the torque falls below 1,3350, a 100 -day SMA test is expected in 1,3270.
LIBRA ESTERLINA – FREQUENTLY QUESTIONS
The sterling pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most commercialized currency exchange unit (FX) in the world, representing 12% of all transactions, with an average of $ 630 billion a day, according to data from 2022. Its key commercial peers are GBP/USD, which represents 11% of FX, GBP/JPY (3%) and EUR/GBP (2%). The sterling pound is issued by the Bank of England (BOE).
The most important factor that influences the value of sterling pound is the monetary policy decided by the Bank of England. The Bank of England bases its decisions itself has achieved its main objective of “price stability”: a constant inflation rate of around 2%. Its main tool to achieve this is the adjustment of interest rates. When inflation is too high, the Bank of England will try to control it by raising interest rates, which makes access to credit for people and companies more expensive. This is generally positive for sterling pound, since higher interest rates make the United Kingdom a more attractive place for global investors to invest their money. When inflation falls too much it is a sign that economic growth is slowing down. In this scenario, the Bank of England will consider lowering interest rates to reduce credit, so that companies will borrow more to invest in projects that generate growth.
Published data measure the health of the economy and can affect the value of sterling pound. Indicators such as GDP, manufacturing and services PMI and employment can influence the direction of the sterling pound.
Another important fact that is published and affects the pound sterling is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will benefit exclusively from the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
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.
