- The pound sterling bounces about 1,3300 against the US dollar while the USD index struggles to extend its two -day recovery.
- The US Treasury Secretary, Besent, expects a reduction in additional tariffs by both the US and China.
- Investors expect the requests for the request of the US durable goods and the retail sales of the United Kingdom for March.
The sterling pound (GBP) bounces about 1,3300 against the US dollar (USD) in the European session on Thursday. The GBP/USD pair bounces after a two -day correction while the USD struggles to extend the recovery, with the US dollar index (DXY), which tracks the value of the dollar against six main currencies, facing pressure near the psychological level of 100.00.
The USD index was strongly recovered earlier this week after the US president Donald Trump moved away from threats to fire the president of the Federal Reserve (Fed), Jerome Powell, and softened his position on commercial relations with China.
President Trump clarified on Tuesday that he has no intention of saying goodbye to Jerome Powell. Investors had sold the US dollar and US assets in the last days of negotiation due to a series of Trump verbal attacks on the independence of the Fed for not supporting the expansion of monetary policy. This led investors to reassess the status of “safe refuge” of the US dollar.
Meanwhile, the fear of an intense commercial war between the US and China had also promoted the demand of the USD. On Tuesday, Donald Trump said that “the discussions with Beijing are going well” and expressed confidence that “they will reach an agreement.”
The hopes of a decalsed in the relationship between the US and China received an additional impulse when US Treasury Secretary Scott Besent, said Wednesday that Wednesday Both nations will reduce additional tariffs recently imposed. None of the parties believe that these are “sustainable levels”, Besent said.
In the economic field, investors expect the data of orders for the US durable goods for March, which will be published at 12:30 GMT. It is expected that the cost of orders received by the manufacturers of lasting goods has grown at a robust rate of 2% compared to a 1% increase seen in February.
What moves the market today: the sterling pound will be influenced by the United Kingdom retail sales data
- The sterling pound shows mixed performance in front of its peers on Thursday. The British currency is surpassing its American peers, but is down against the euro (EUR), with investors becoming cautious about the probable economic panorama of the United Kingdom before the tariffs announced by President Trump earlier this month.
- The governor of the Bank of England (BOE), Andrew Bailey, has expressed concerns about economic growth and has emphasized the need to consider the risk of a commercial war. “We must take the risk for growth very seriously,” Bailey said outside the spring meetings of the International Monetary Fund (IMF) on Wednesday and added “we are currently working on that because we have a decision on interest rates that are coming in two weeks,” Reuters said. At the May policy meeting, the operators are increasingly sure that the BOE will cut interest rates at 25 basic points (PB) to 4.25%.
- For the rest of the year, the IMF has anticipated three interest rate cuts by the BOE and has reviewed the growth of the Gross Domestic Product (GDP) of the United Kingdom by 2025 to 1.1% from 1.6% previously projected in the midst of concerns about global repercussions due to Trump’s international policies, BBC News reported.
- In the economic field, investors will focus on retail sales data from the United Kingdom for March, which will be published on Friday. Retail sales data, a key measure of consumer spending, are expected to have decreased 0.4% month by month after having increased by 1% in February. In annual terms, it is estimated that the consumer spending measure has increased at a moderate rate of 1.8% compared to the previous 2.2% publication.
Technical analysis: The pound sterling bounces about 1,3300
The sterling pound is recovered about 1,3300 against the US dollar during the European negotiation hours on Wednesday. The prospects of the PAR are still firm since all long -term exponential mobile socks are inclined to rise.
The 14 -day relative force index (RSI) cools about 65.00 after having been overcompiled. This indicates a slight correction in the pair after a strong rebound, but the upward trend remains intact.
On the positive side, the psychological level of 1,3500 will be a key obstacle to the torque. Looking down, the maximum of April 3 around 1,3200 will act as an important support area.
LIBRA ESTERLINA FAQS
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.
