The GBP/USD price will be a conflict of interest as UK issues a few important economic figures amid the United States inflation concerns. The pair is currently trading at 1.4097 which is nearly a 0.7% rise from its support at 1.400.
UK Employment Numbers and US Inflation
In the recent past, the GBP/USD pair responded to the US inflation and unemployment rate data. Data from the Bureau of Labor Statistics show that unemployment rates in the United States recorded a 6.1% high in April this year. The Consumer Price Index surged by 4.2% which was the fastest CPI growth rate since 2008. The Producer Price Index (PPI) also rose at the fastest rate since 2011.
This week, the United Kingdom will be on the limelight as economists expect it to publish its employment and inflation numbers. According to the Office of National Statistics (ONS), the unemployment rate is expected to have taken a nosedive from 4.9% to 4.7% in March. This will be a strong growth which the government supports.
Analysts are also expecting the number of applicants to reduce as UK focuses on doing away with the lockdown and improving wages. This decision might be a major improvement to the country’s economy.
The GBP/USD will react to the latest retail sales numbers of UK that will be released on Friday this week. The month-on-month high is expected to be up by 4.0% as the YoY numbers took nosedive in April last year due to the Corona virus pandemic.
The country’s inflation data will be announced on Wednesday this week. Economists expect the headline Consumer Price Index to on a month-on-month high of 0.5% leading to an annual gain of 1.4%. the core CPI is also expected to record a 0.3% increase with a yearly profit of 1.2%. This, however, is divergent with the 2.0% target of the Bank of England.
Support and Resistance
Support 1: 1.4040
Support 2: 1.4000
Resistance 1: 1.4150
Resistance 2: 1.4200