- On Tuesday, the GBP/USD exchange rate fell as greenback buying activity remained strong.
- In February, the ILO Unemployment Rate in the Uk fell to 3.8 percent.
- The market’s attention is still focused on the latest consumer inflation numbers from the US.
GBP/USD fundamental forecast
At the start of the London session, GBP/USD is clinging to the 1.3000 level. The greenback buying interest can put pressure on the Cable.
UK ILO down
The ILO Unemployment Rate fell to 3.8% in the three months to February from 3.9% in January, according to figures released by the UK’s Office for National Statistics (ONS) on Tuesday. This result was somewhat higher than the market’s forecast of 3.9%.
The British pound came under some selling pressure due to the initial market response.
Safe-haven greenback
So far this week, the dollar has managed to recapture and push farther north of the critical 100-barrier. So far, the greenback’s market behavior has been determined by the Fed’s likelihood of tightening its rate path and geopolitics.
Furthermore, the present rising inflation story, higher US rates, and the solid performance of the US economy all support the case for a stronger currency.
Boris meets Zelensky
The British Prime Minister, Boris Johnson, paid a surprise visit to Ukraine’s capital and met with Ukrainian President Volodymyr Zelenskiy.
Johnson, who appeared beside V. Zelenskiy in a taped broadcast clip, said the west would continue to “ratchet up” sanctions on Russia while praising the Ukrainian resistance’s bravery.
Also, on Tuesday, V. Zelenskyy delivered a video speech to the Lithuanian parliament, calling on the European Union to penalize all Russian banks and oil imports in the next round.
Key data releases from the UK
From the UK, we don’t have anything today. However, tomorrow’s core inflation can bring fresh impetus for the Cable.
Key data releases from the US
The market’s attention will be drawn to the latest US consumer inflation data, released later in the early North American session.
What’s next to watch for GBP/USD?
The US inflation statistics for March will be scrutinized for new impetus. A higher-than-expected CPI figure might help the dollar maintain its momentum while weighing on GBP/USD.
Furthermore, fears that the Ukraine conflict and China’s new Covid-19 limitations would stifle the global economy should support the safe-haven greenback and cap the GBP/USD pair.
GBP/USD technical analysis: clinging to 1.3000, but for how long?
GBP/USD is now trying to stay above the 1.3000 level. So far, the pair has lost 0.09%. The pair is way below its 100-day moving average on the daily chart, and the RSI is near 30.
GBP/USD is now hitting the 1.3017 level. A fall below 1.2994 will bring the pair towards the 1.2958 support level. If the pair falls below this level again, it will challenge the next support level, 1.2926.
On the upside, the Cable can go towards the next resistance level, around 1.3026. A break over 1.3093 will pave the door for a test of the following resistance level of 1.3129.
