Daily Price Outlook

The GBP/USD is currently trading at 1.2151, which reflects a decrease of 0.25% in the last 24 hours. As traders anticipate significant economic data releases from the US and the UK, the pair is restricted to its recent trading highs.

Upcoming UK Macroeconomic Data

The upcoming UK employment statistics release is expected to have a significant impact on the British Pound in the days ahead. According to experts, the Claimant Count Change (Feb) is predicted to decrease by 12.4K, which is slightly less than the previous announcement of 12.9K. However, the three-month unemployment rate may rise to 3.8% from the previous release of 3.7%.

The Average Earnings data is expected to be the primary driver, with a predicted decrease to 5.7% from the previous release of 5.9%.

Investors must exercise caution as the UK economy faces inflationary pressures from rising labor costs and persistent increases in food prices. A decrease in UK employment costs and an increase in the unemployment rate could potentially reduce inflation expectations.

Despite this, the Pound is struggling to gain momentum due to investor concerns about risks to the UK financial system, leading to lower risk sentiment. However, if the Average Earnings Index and Claimant Count Change exceed expectations, it could potentially benefit the GBP/USD pair.

US Upcoming CPI

Following the fallout of SVB US on Friday, the US markets saw a significant decline. Despite emergency measures implemented by US authorities over the weekend to mitigate risk and restore confidence in the US banking system, investors remain uneasy today.

Although the risk-off sentiment initially supported the USD, markets have reduced their expectations for the Federal Reserve to raise interest rates. The US banking industry is displaying signs of instability due to high-interest rates, which could make Fed officials hesitant to implement further tightening measures.

Traders are currently anticipating Tuesday's US CPI release. According to market forecasts, the US CPI is expected to fall 6.0% YoY from 6.4%, while the CPI ex-Food & Energy might decline to 5.5% YoY from 5.6%.

As investors await the US CPI data, the dollar has risen again, with DXY up 0.25% on the day and trading at 103.86. The 10-Year US Treasury Rate in the bond markets was at 3.569%. Furthermore, if the US CPI comes in below expectations, it could strengthen the GBP/USD pair.

GBP/USD Intraday Technical Levels

Support      Resistance

1.2081         1.2242

1.1980         1.2302

1.1919         1.2404

Pivot Point: 1.2141

GBP/USD – Technical Outlook

The GBPUSD pair has remained relatively unchanged since this morning and is hovering around the 1.2150 level. The expected bullish trend scenario for today remains unchanged, targeting the 1.2260 and 1.2440 levels as the next main stations. However, a positive motive is needed to push the price towards the suggested targets.

It is important to note that the continuation of the bullish wave depends on the price staying stable above 1.2070. The expected trading range for today is between 1.2070 support and 1.2250 resistance.

Daily Price Outlook

The GBP/USD is trading at 1.2062, up 0.28%in 24 hours.The pair gained momentum, rebounding substantially from recent losses as investors bet that the Federal Reserve will soften its hawkish rhetoric in the coming days in response to a growing banking crisis in the US.

Federal Reserve Board of Governors urgent meeting

The Federal Reserve Board of Governors scheduled an urgent closed-door meeting using expedited protocols on Monday, March 13. The Board reviewed and decided the advance and discount rates that the Fed would impose.

The unexpected collapse and FDIC seizure of Silicon Valley Bank (SVB) Financial Group on Friday may have caused this hurried Fed meeting. The Fed used emergency steps to make borrowing easier for troubled banks. The White House also informed Silicon Valley Bank depositors that it would cover all withdrawals. Jerome Powell and his allies rushed in to help with a new tool to save the billionaire tech depositors at SVB and Signature Bank against hawkish threats of a 50bps rise.

Moreover, in March, the odds of a 50bps rise fell from 75% to less than 20%, and in May, the probability of a 25bps hike fell from a coin flip to only 85%. As a result, the dollar dropped significantly versus a basket of currencies, with DXY trading 0.23% down at 104.33. US 10-Year Bond Yield is now trading at 3.737, up 1.14%.

The unexpected fall in the dollar helped the GBP/USD currency pair to gain value.

UK and US Economic Conditions

British economic growth in January exceeded expectations, relieving concerns about a possible recession. Britain's GDP grew 0.3% month over month, following a 0.5% decline in December. According to a Reuters survey of economists, growth would be 0.1%.

In the United States, Nonfarm Payrolls revealed significant job growth last week, despite the rise in the Unemployment Rate and signs of cooling wage inflation, leading investors to lower expectations that the Federal Reserve will hike interest rates as sharply as expected.

Going ahead, traders are awaiting the US consumer price index and UK labor market data on Tuesday. BoE will especially appreciate slower wage growth following last month's positive surprise. However, with US CPI released, market reaction may be limited unless there is a significant surprise.

GBP/USD Intraday Technical Levels

Support      Resistance

1.2044         1.2108

1.2010         1.2138

1.1980         1.2171

Pivot Point: 1.2074

GBP/USD – Technical Outlook

The GBPUSD pair is currently exhibiting a bullish bias and hovering around the 1.2100 level. For the bullish trend to continue as anticipated, a positive catalyst is needed to push the price towards its next target at 1.2260.

To achieve the expected targets, we recommend maintaining a bullish trend that relies on price stability above 1.2050. Breaking below this level will result in a price decline towards 1.1940 before any new positive attempts. Today's anticipated trading range is expected to fall between support at 1.2040 and resistance at 1.2200.

Daily Price Outlook

The GBP/USD pair traded around 1.1916 on early Friday as bulls paused after the largest daily gain in over a week. Significant data releases are expected from both the UK and the US.

Upcoming US Economic Data

Federal Reserve Chairman Jerome Powell has emphasized the need for more interest rate hikes to control inflation, citing stronger-than-expected economic figures showing continuing inflationary pressures.

However, rising jobless claims have lessened the tightness of the labor market, despite positive ADP data on Wednesday and more job openings than anticipated. Thursday's data showed weekly jobless claims were 211K more than the projected 195K.

Despite these US statistics, the US Dollar's rise has been halted by a risk-off sentiment. The US Dollar Index (DXY) is edging downwards at 105.28 before the release of major US statistics such as average hourly earnings, nonfarm employment change, and unemployment rate. Additionally, US 10-year Treasury bond rates are falling to 3.874 ahead of the jobs report.

Traders are anticipating the US Nonfarm Payrolls data, which could lessen the Federal Reserve's requirement to tighten conditions more quickly if the data is downbeat and shows rising jobless claims.

UK GDP Report and GBP/USD Exchange Rate Outlook

Market participants are waiting for the UK's GDP report release. While the market is anticipating a 0.1% increase in January's GDP, which is a significant improvement over December's 0.5% fall, the possibility of a recession in the first half of the year remains a topic of debate.

The Bank of England's ability to control inflation, which has remained high at 10.1% even after lifting the cash rate to 4.00%, will be crucial in determining how much the economy will shift.

However, Bank of England (BoE) policymaker Swati Dhingra cautioned against interest rate hikes on Wednesday, stating that over-tightening poses a more significant concern. Since the BoE appears less hawkish than the Fed, an expected relaxation in UK macroeconomic data today may allow GBP/USD bears to resurface.

GBP/USD Intraday Technical Levels

Support      Resistance

1.1858         1.1967

1.1790         1.2008

1.1749         1.2076

Pivot Point: 1.1899

GBP/USD – Technical Outlook

The GBPUSD pair tested the resistance level of 1.1940, remaining stable below it as the EMA50 added more strength to the resistance. The pair will likely continue its downward correctional wave with a target of 1.1625.

The Stochastic indicators show clear negative signals, suggesting a potential decline in upcoming sessions, as the pair trades within a bearish channel depicted on the chart.

Therefore, our bearish outlook remains valid and active. It is important to note that if the pair breaches the 1.1940 and 1.2020 levels, the expected decline may be halted, and the price could begin to recover.

Daily Price Outlook

The GBP/USD currency pair has failed to stop its previous declines and is still flashing red around the $1.1810 mark amidst ongoing Brexit uncertainties and chatter from the Federal Reserve regarding future monetary policy.

At present, the GBP/USD currency pair is trading within a relatively tight range of 1.1810 to 1.1842, with the current price at 1.1831, indicating a lack of decisive market movements. Ongoing Brexit uncertainties and mixed signals from the US Federal Reserve may be contributing to this trend.

Brexit has been a major driver of the GBP/USD pair's poor performance, as investors remain concerned about the UK's future relationship with the European Union. The lack of progress on these issues has resulted in GBP losses and affected the pair's overall performance.

Additionally, the Bank of England's monetary policy stance has played a role in the GBP/USD pair's performance. The central bank has been under pressure to support the UK economy during the COVID-19 pandemic and has implemented a range of monetary policy tools, such as interest rate cuts and asset purchases.

Feds Hawkish Stance & Bullish US Dollar

Recently, the US Federal Reserve has taken a hawkish tone, suggesting that interest rates may be raised sooner than originally anticipated. This has led to a stronger US dollar, as traders anticipate tighter monetary policy in the future, reinforced by positive economic indicators such as lower unemployment and increasing inflation.

The bullish US dollar has an impact on other currencies, including the GBP/USD pair, as traders adjust their strategies in response to changing market conditions. This hawkish approach and strong US currency suggest the possibility of a shift in the global economic environment in the coming months.

On Wednesday, the US dollar strengthened against a basket of currencies, reaching its highest level in three months. The dollar index and dollar index futures both rose by 0.2%, hitting their best levels since early December. The reasons for the dollar's rise are not entirely clear, but it may be due to global economic uncertainty and market volatility, as well as the Federal Reserve's hawkish tone and the strength of the US economy.

GBP/USD Price Chart - Source: Tradingview

GBP/USD Intraday Technical Levels

Support      Resistance

1.1997         1.2052

1.1967         1.2079

1.1941         1.2108

Pivot Point: 1.2023

GBP/USD – Technical Outlook

The GBPUSD pair has strongly broken the 1.1940 level and is currently hovering around the 1.1800 level, indicating a return to the bearish correctional track. Further expected declines are likely on an intraday and short-term basis, with our next target at 1.1625.

As such, we anticipate continued bearish trend dominance in the upcoming trading sessions, bolstered by the negative pressure from the EMA50. However, there may be some temporary sideways fluctuation due to the current positivity of stochastic before the expected decline resumes.

It should be noted that breaking through the 1.1940 level would halt the current negative pressure and initiate new recovery attempts. Today's projected trading range is between 1.1720 support and 1.1890 resistance.

Daily Price Outlook

The GBP/USD pair is currently trading at 1.2045, reflecting a 0.20% increase in the past 24 hours. The pair has been supported by the weakness of the US dollar.

UK Construction Sector Sees Fastest Economic Activity Growth in February

The UK construction sector experienced a significant increase in overall economic activity in February after a two-month decline. The UK PMI construction index rose to a 9-month high of 54.1 in February from 48.4 in January, surpassing consensus expectations of 49.1.

The commercial construction sector performed the best in February with an index of 55.3, showing the fastest increase in nine months. Civil engineering activities also increased in February (index 52.3), but at a slower pace.

Based on the latest data, employment levels in the construction industry have seen a slight increase. Furthermore, the significant rise in output in the previous month presents a positive outlook for the construction industry as a whole. This data has had a positive impact on the GBP, indicating that the UK's construction industry is improving.

US Economy

In the US, inflationary pressures have put Jerome Powell, the head of the Federal Reserve, in the spotlight as he prepares to address Congress today. Powell is expected to provide an update on the state of the US economy and discuss the central bank's plans for monetary policy.

In addition, the non-farm payroll data for February is set to be released on Friday. It is expected to show a significant drop compared to January, bringing job openings back to the typical range of around 200,000. If the data meets expectations, it could indicate a tight labor market, thereby strengthening the US dollar.

The US dollar has weakened against a range of global currencies prior to Powell's testimony and the release of the jobs report. The DXY is currently trading lower, around 104.23. However, if Powell's tone becomes more hawkish, it may strengthen the dollar and increase expectations for the US interest rate movement.

GBP/USD Intraday Technical Levels

Support      Resistance

1.1997         1.2052

1.1967         1.2079

1.1941         1.2108

Pivot Point: 1.2023

GBP/USD – Technical Outlook

From a technical perspective, the GBP/USD pair has found support at the 1.2015 level, and a bullish rebound may occur if candles close above this level.

The pair may face immediate resistance at the 1.2045 level, driven by a double-top pattern that has persisted in the past.

A break above the 1.2145 level may lead to further upward movement in the GBP/USD price.

Daily Price Outlook

The GBP/USD pair is currently trading at 1.2039, showing a 0.16% increase in the last 24 hours. According to a report released on February 28th, the Chicago Purchasing Managers' Index (PMI) fell from 44.3 in January to 43.6 in February, which is below the expected level of 45.

This marks the second consecutive month of decline. In addition, the Conference Board's Consumer Confidence Index dropped from 106 in January to 102.9 in February, falling short of the expert estimate of 108.5.

Exploring the Impact of Softer US Data on GBP/USD Exchange Rates

On February 28th, a report revealed that the Chicago Purchasing Managers' Index (PMI) fell from 44.3 in January to 43.6 in February, falling short of the expected level of 45 for the second consecutive month. Additionally, the Conference Board's Consumer Confidence Index dropped from 106 in January to 102.9 in February, failing to meet the expert estimate of 108.5.

These figures indicate increased pressure from rising interest rates. As a result, traders are anticipating a potential increase in the federal funds rate from 525 bps to 550 bps by the Federal Reserve. The upcoming release of February business activity numbers on March 1st and 3rd will be closely watched by investors. It is expected that the US manufacturing sector may continue to decrease, which would reverse the growth seen in the services industry.

Currently, the US Dollar Index is trading around a two-month high versus a basket of currencies at approximately 105.00.

An Overview of the UK Economy

The UK's positive financial performance has continued to support a progressive increase in sentiment, as seen in recent trends. Today, the final UK Manufacturing Purchasing Managers' Index (PMI) numbers for February will be released, followed by a speech from Bank of England (BoE) Governor Andrew Bailey, highlighting today's economic calendar for the GBP. The Composite PMI Index is expected to rise from 48.5 to 53.0 points this month, with a projection of 49.0.

Hawkish statements from BoE policymakers may potentially drive the currency higher, and the Pound may gain if Bailey signals that additional measures are required to bring inflation back within the BoE's target range. Conversely, if he expresses concerns about growth, it would dampen hopes for a BoE interest rate rise, weakening the pound.

Windsor Framework

The UK and EU have recently agreed on the 'Windsor Framework,' as announced by Prime Minister Rishi Sunak and President of the European Commission Ursula von der Leyen on February 27th. Sunak stated that the new Brexit agreement focuses on 'what is best for people in Northern Ireland,' rather than politicians.

This new agreement to resolve the conflict around the Northern Ireland protocol has contributed to the Pound's recent gains.

GBP/USD Intraday Technical Levels

Support      Resistance

1.1983         1.2114

1.1932         1.2194

1.1851         1.2245

Pivot Point: 1.2063

GBP/USD – Technical Outlook

On a technical front, the GBP/USD currency pair has gained immediate support at the 1.2015 level. The closing of candles above this level is driving a bullish bounce, which could potentially lead the GBP price toward an immediate resistance level of 1.2045.

This particular resistance level is driven by a double-top pattern that has extended even in the past. Breaking above the 1.2145 level could potentially send the GBP/USD price further upward.