- On Wednesday, the GBP/USD surpassed the 1.3100 level as the bullish momentum persisted.
- The British Pound is experiencing a strong demand as the American Dollar retreats.
- Jackson Hole and the release of PMI data are still on the horizon.
Cable is currently exhibiting a solid bullish trend, as evidenced by the fact that the GBP/USD pair briefly touched the upper level of 1.3100 on Wednesday. After reaching a peak intraday offer of 1.3112, the pair is making progress toward brand-new highs that have not been seen in more than a year. At this very moment, the value of the British Pound in relation to the United States Dollar is on the verge of reaching its highest level since April of 2022.
According to the Nonfarm Payrolls (NFP) jobs report for March, the United States Bureau of Labor Statistics reported a significant decrease of over 800,000 jobs. This resulted in substantial downward revisions to the numbers that were previously reported for job growth.
The increase in hiring figures led to the markets’ overall expectations, which included a potential double cut from the Federal Reserve (Fed) in September. Following the publication of the Federal Reserve’s Meeting Minutes on Wednesday, which revealed that policymakers had begun discussions regarding the possibility of starting interest rate reductions as early as July, expectations for a rate cut were further strengthened. This was the case because the minutes revealed that policymakers had begun discussions.
The Purchasing Managers Index (PMI) figures for the month of August in the United Kingdom are anticipated to show a slight increase over the previous month, as indicated by the forecasts. To be more specific, the component of the UK Services PMI is anticipated to increase from 52.5 to 52.8. According to projections, the Manufacturing section will continue to maintain its current level of 52.1.
It is planned that the results of the United States PMI business activity survey will be made public on Thursday. This will coincide with the beginning of the annual Jackson Hole Symposium, which will take place throughout the weekend. This coming Wednesday, the Federal Reserve (Fed) will release the most recent meeting minutes that it has compiled. Still, market forces will primarily be concentrating their attention on the events that will take place on Thursday in search of potential catalysts.
The S&P Global Manufacturing PMI activity in the United States is anticipated to remain unchanged at 49.6 during the month of August. On the other hand, the Services PMI component is expected to decrease by a whole point, from 55.0 to 54.0.
The beginning of the Jackson Hole Symposium is anticipated to attract a significant amount of investor interest on Thursday. On the other hand, the appearance of Fed Chairman Jerome Powell on Friday is likely to impact market sentiment for the coming week.
Technical Analysis of GBP/USD
GBP/USD is on the verge of surpassing multi-year highs as long as buyers can maintain sufficient pressure to propel prices beyond the July peak of 1.3142 from 2023. Cable has been surging for a fifth consecutive increase and is currently on the verge of surpassing previous highs. At the end of each of the ten consecutive trading days, the GBP/USD trading pair has finished in positive territory, putting buyers in the driver’s seat. The only exception to this is one of the trading days.