GBPUSD is moving in Ascending channel and market has reached higher low area of the channel
GBP/USD Struggles Amid Key Economic Events
Introduction
The GBP/USD currency pair saw some action on Monday, briefly rising above 1.2840 before retreating. This week is packed with crucial events, especially from the US, that could significantly impact the pair. Let’s dive into what traders can expect and how these events might shape the market.
Fed Chair Powell’s Appearances
First Appearance: Senate Banking Committee
This week, all eyes are on Fed Chair Jerome Powell. His first of two appearances is set for Tuesday when he presents the Fed’s latest semiannual Monetary Policy Report to the US Senate Banking Committee. Powell’s remarks will be closely scrutinized for any hints about future monetary policy.
The Fed has been cautious, waiting for more evidence that US inflation will move closer to its 2% target. Traders are eager to see if Powell’s comments will provide any insight into the Fed’s plans for interest rates. Will he signal a potential rate cut, or will the Fed continue to hold its ground?
Second Appearance: House Committee on Financial Services
On Wednesday, Powell will testify again, this time before the Congressional House Committee on Financial Services. This follow-up session is expected to reiterate key points from Tuesday, but it’s still a critical event for the market. Powell’s testimony could either reinforce or challenge market expectations, making it a must-watch for traders.
Key US Inflation Data
Consumer Price Index (CPI) on Thursday
The US Consumer Price Index (CPI) data is scheduled for release on Thursday. This is a major indicator of inflation and will be pivotal in shaping market expectations. If the CPI shows signs of inflation holding steady or increasing, it could influence the Fed’s stance on interest rates.
Traders hoping for a decrease in inflation might be setting themselves up for disappointment. Current forecasts suggest that inflation could remain steady or even tick upwards slightly. This could lead to heightened volatility in the GBP/USD pair as market participants adjust their expectations.
Producer Price Index (PPI) on Friday
Following the CPI data, the Producer Price Index (PPI) will be released on Friday. This measures wholesale inflation and is another critical indicator for the Fed. Similar to the CPI, if the PPI indicates rising inflation, it could impact the Fed’s decisions and, consequently, the GBP/USD pair.
GBPUSD is moving in Symmetrical Triangle and market has reached lower high area of the pattern
Market participants will be closely analyzing both CPI and PPI data to gauge the likelihood of future rate cuts. If inflation remains stubbornly high, the Fed might hold off on cutting rates, which could strengthen the US dollar and put pressure on the GBP/USD pair.
UK Data and Bank of England (BoE) Policymakers
Bank of England Policymakers’ Appearances
While the spotlight is on the US this week, the UK has its share of events that could influence the GBP/USD pair. Several Bank of England (BoE) policymakers are set to speak on Wednesday. Their comments will be essential in understanding the BoE’s perspective on the current economic situation and future monetary policy.
The BoE has been dealing with its own set of challenges, including balancing inflation concerns with economic growth. Traders will be looking for any hints about the BoE’s plans, especially in the context of recent economic data.
Industrial and Manufacturing Activity Survey Results
On Thursday, the UK will release survey results for industrial and manufacturing activity. After a slight contraction in the previous month, both industrial and manufacturing production are expected to rebound in May. Positive results could provide some support to the British pound, but the overall impact on the GBP/USD pair will also depend on the broader market sentiment driven by US data and Fed commentary.
Final Summary
This week is shaping up to be eventful for the GBP/USD currency pair, with significant economic events and data releases from both the US and the UK. Fed Chair Powell’s appearances and key US inflation data will be pivotal in shaping market expectations and influencing the pair’s movement. On the UK side, comments from BoE policymakers and industrial and manufacturing activity results will also play a role. Traders should stay alert and be prepared for potential volatility as these events unfold.
Don’t trade all the time, trade forex only at the confirmed trade setups
Get more confirmed trade signals at premium or supreme – Click here to get more signals , 2200%, 800% growth in Real Live USD trading account of our users – click here to see , or If you want to get FREE Trial signals, You can Join FREE Signals Now!
