The GBP/USD pair has shown a recovery move after building a base around 1.2320 in the Tokyo session. The Cable is expected to extend recovery further as the US Dollar Index (DXY) has dropped further below 104.10 amid hopes of a pause in the policy-tightening spell by the Federal Reserve (Fed).
S&P500 futures have posted decent losses in early Asia as investors are getting cautious due to unresolved US borrowing cap issues. The deviation in proposed budget spending by the White House to Republican leaders has narrowed to $70 billion from the original proposal of $1 trillion. Meanwhile, House of Representatives Kevin McCarthy cited that his team is working on reaching a bipartisan.
However, US Treasury Secretary Janet Yellen is consistently warning that the Federal government will be out of funds by June 01 and could make default in some obligated payments.
The USD Index is looking to extend its downside journey towards 104.00 as a pause in a rate-hiking spell by the Fed would trim interest rate divergence with other central banks. Richmond Fed Bank President Thomas Barkin said on Thursday that the US labor market remains tight and added noted that some businesses are still saying that they need to raise prices, per Reuters. However, he added that higher interest rates and tight credit conditions by US regional banks have impacted heavily on demand.
On the Pound Sterling front, investors are awaiting the release of the United Kingdom Retail Sales data (April). As per the preliminary report, monthly Retail Sales are seen expanding by 0.3% against a contraction of 0.9% reported last month. While annual Retail Sales are expected to contract by 2.8% vs. a contraction of 3.1%. A rebound in retail demand could fuel inflationary pressures and create more troubles for the Bank of England (BoE).
© 2000-2023. All rights reserved.
This site is managed by Teletrade D.J. Limited 20599 IBC 2012 (First Floor, First St. Vincent Bank Ltd Building, James Street, Kingstown, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at firstname.lastname@example.org.