GBP/USD stabilizes above 1.2300 after strong US-UK data, as US ceiling talks continued – by christianborjon GBPUSD Currencies Majors Macroeconomics
hat witnessed solid US and UK data. Therefore, the GBP/USD stays positive in the day, gains 0.19%, and trades around 1.2340s.
Solid economic data set the stage for possible Fed’s June rate hike, UK Retail Sales at its fastest pace in almost two yearscontinue to run the Artificial Intelligence frenzy underpinned by NVIDIA and Maxwell Technologies. The latest tranche of US economic data, with the Fed’s preferred gauge for inflation, the Core PCE rising to 4.7% YoY in April, and headline PCE hitting 4.
Given the backdrop, US Treasury bond yields advance, with the 10-year benchmark note rate at 3.851%, its highest level since March 10, a headwind for the GBP/USD exchange rate. The greenback strengthened, as shown by theIndex , up 0.04%, at 104.255. If the DXY achieves a daily close above the 103.752 area, that would confirm the buck’s bullish bias.
Recently, the Cleveland Fed President Loretta Mester stood to her hawkish stance and confirmed that inflation is too high in an interview on CNBC. She said that she would revise her forecast for inflation and that more data would help her to decide on the June meeting while emphasizing that “everything is on the table” for the next FOMC decision.
Aside from this, US debt ceiling talks continued and will resume over the weekend, with both sides confident of achieving a deal before the US Treasury runs out of cash by June 1.rose to its highest pace in almost two years. That, alongside high inflation data revealed during the week, spurred a reaction in the swaps markets, with most traders expecting at least 100 bps of increase to the bank rate, which would reach 5.50%.
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