GBP/USD licks UK inflation, Fed inflicted wounds around mid-1.2000s as US Dollar retreats – by anilpanchal7 GBPUSD RiskAppetite Fed BOE Inflation
In addition to the lack of major data/events, the risk-positive headlines from China and fears surrounding the US debt ceiling also seemed to have helped the GBP/USD pair in trimming the latest losses.
China President Xi Jinping recently crossed wires while showing readiness to deepen industrial and investment cooperation with Asia. “Willing to share ultra-large-scale markets, complete industrial systems and advanced technologies with central Asian countries,” said China’s Xi. On the other hand, fears of witnessing the US debt-ceiling crisis, as warned by the US Congressional Budget Office on Wednesday per Reuters, seem to probe the US Dollar bulls at the multi-day high and allow the GBP/USD to lick its wounds. eases to 103.70, after rising to a fresh six-week high the previous day. Further, S&P 500 Futures rise 0.20% but whereas the US 10-year Treasury bond yields retreat following the run-up to a 1.5-month high marked on Wednesday. dropped to 10.
Alternatively, US Retail Sales growth jumped to 3.0% YoY in January versus 1.8% expected and -1.1% prior. Further, The Retail Sales ex-Autos grew by 2.3% in the same period, compared to analysts' estimate of +0.8%. On the same line, the NY Empire State Manufacturing Index for February improved to a three-month high of -5.8 versus -18.0 expected and -32.9 market forecasts. Alternatively, the US Industrial Production marked 0.0% MoM figures for January, compared to analysts’ estimate of 0.
It should be noted that the market’s bets on the Fed’s next moves, as per the FEDWATCH tool of Reuters, suggest the US central bank’s benchmark rate is to peak in July around 5.25% versus the December Federal ReserveMoving on, a light calendar in the UK may allow GBP/USD to grind higher ahead of the US data concerning the housing market, industrial activity and producer prices. Following that, the UK Retail Sales for January, up for publishing on Thursday, will be eyed for clear directions.
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