GBP/USD prints a three-day uptrend as bulls approach the 1.2400 resistance confluence during very early Tuesday morning in Europe, refreshing intraday high to around 1.2370 by the press time.
In doing so, the Cable pair not only cheers the US Dollar’s pullback amid the risk-on mood but also benefits from the hawkish hopes surrounding the Bank of England (BoE). It’s worth noting that the Pound Sterling pair dropped to the lowest levels in early April in the last week.
Earlier in the day, the British Retail Consortium (BRC) released Shop Price Index figures for April while conveying a record pressure on inflation due to the actual outcome. That said, the BRC Shop Price Index rises to 9.0% in April from 8.8% prior. It’s worth noting that BoE policymaker Jonathan Haskel said on Friday, “If we do see evidence of more inflation persistence, we will tighten policy.”
On the other hand, the US Dollar Index (DXY) reverses from a six-month-old resistance line to print the first daily loss in seven around 104.10 as firmer sentiment weigh on the US Dollar’s haven demand.
That said, the weekend news suggesting the US policymakers’ deal on the debt-ceiling extension to January 2025 allowed traders to remain hopeful after a long weekend in major economies. However, some of the policymakers, mostly Republicans, are against the compromises made to their previous demands to reach the deal. The policymakers also show readiness to challenge the agreement in the House, as well as in the Senate, which in turn prods the market’s previous risk-on mood and keeps the US Dollar on the front foot. “A handful of hard-right Republican lawmakers said on Monday they would oppose a deal to raise the United States' $31.4 trillion debt ceiling, in a sign that the bipartisan agreement could face a rocky path through Congress before the US runs out of money next week,” said Reuters.
Against this backdrop, the S&500 Futures print mild gains around 4,220 after retreating from the yearly high the previous day whereas the US Treasury yields drop by the press time.
Looking ahead, Wednesday’s US House voting on the debt-ceiling agreement and the Senate’s approval for the same before June 05, as well as Friday’s US jobs report, gains major attention. However, today’s US CB Consumer Confidence for May, expected to ease from 101.30 prior readings, will be important to determine the Cable pair’s intraday moves.
GBP/USD picks up bids inside a three-week-old bearish channel, recently approaching the 1.2400 resistance confluence comprising the 10-DMA and the stated channel’s top line.
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