Pound Sterling Strengthens Ahead of UK PMI and Retail Data

Pound Sterling Strengthens Ahead of Key UK Economic Data

GBP/USD Rises as BoE Easing Bets Fade

The British Pound (GBP) posted a 0.3% gain against the US Dollar (USD) on Monday, standing out among G10 currencies as traders priced out aggressive Bank of England (BoE) easing. The GBP/USD pair remains supported above the 1.3400 level, with yields holding steady after last week's move higher.

“The Pound is holding firm as expectations for rate cuts soften. With less than 50bps of easing priced in for 2024 and debate surrounding additional moves in 2025, the bias appears tilted to the upside,” say analysts.

Market Eyes on UK PMIs and Retail Sales This Week

The next key catalysts for the Pound are the UK flash PMIs on Thursday and retail sales data on Friday, both of which are expected to provide insight into the health of consumer demand and business activity.

Technical Setup: Support at 1.3400, Resistance at 1.3550+

On the technical front, the Relative Strength Index (RSI) is rebounding toward neutral territory (50), signaling a possible shift in momentum. Analysts are watching the 1.3400 support and 1.3550 resistance levels as the immediate range for GBP/USD. A break above could trigger further gains, especially with the current bullish undertone.

Key Takeaways

• GBP/USD up 0.3%, outperforming peers
• BoE easing bets fade, supporting GBP
• UK PMIs and retail sales to provide fresh direction
• Technical range between 1.3400 and 1.3550
• RSI recovering, favoring near-term upside

Further Reading on Tredu.com

• GBP/USD Outlook: Can the Pound Push Beyond 1.3550?
• Bank of England Policy Tracker: What Markets Are Pricing
• Why UK PMI and Retail Data Matter More Than Ever