02 April 2024, GBP/USD
Events to pay attention to today:
17:00 EET. USD - JOLTS Job Openings
GBPUSD:
In the early Asian session on Tuesday, the GBP/USD pair remains on the defensive around 1.2545. The rise in US Treasury yields overnight, following the release of favourable US ISM data, has created a headwind for the GBP/USD pair.
Unexpectedly, the US ISM manufacturing PMI data widened in March, with the index rising to 50.3 from 47.8 in February, which was stronger than expectations of 48.4. The index reached its highest level since September 2022, marking the first expansion in manufacturing activity since October 2022. A reading above 50 indicates overall expansion in the manufacturing economy, while a reading below 50 signals contraction. The stronger-than-expected data prompted buying of the US Dollar (USD) across the board.
The Bank of England's (BoE) latest monetary policy statement has put pressure on the Pound Sterling (GBP) due to its dovish stance. Bank of England Governor Andrew Bailey stated that market expectations of two to three rate cuts this year are 'reasonable', and added that the UK central bank does not anticipate a lot of sustained volatility. These comments have fuelled expectations that the Bank of England will cut interest rates in June, leading to a decline in the British Pound against the US Dollar.
Trading recommendation: Trading predominantly Sell orders from the current price level
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