The British pound is showing little movement at the start of the week. In the Monday session, GDP/USD is trading at 1.3858, down 0.08% on the day.
British employment numbers loom
It’s a busy week for UK key releases, starting with employment numbers on Tuesday (GMT 7.:00). The data is expected to be mixed. Wage growth has been on the rise, and is expected to hit 4.9%, up from 4.7%. Unemployment claims are projected to rise by a thousand, and the unemployment rate is forecast to tick up to 5.2% from 5.1%. We’ll get a look at inflation on Tuesday and retail sales on Friday. An interesting development is that the EU has said it may withhold exports of the AstraZeneca corona vaccines to the UK in order to speed up its own vaccine campaign, which has floundered badly. If the EU makes good on this threat, it could weigh on the British pound.
Investors all tuned into Fedspeak
The market will be again paying close attention to the Federal Reserve this week. Later on Monday, Fed Chair Powell will participate in a panel and we’ll also hear from FOMC members today and on Tuesday. Powell will testify on Tuesday and Wednesday before Congress, together with Treasury Secretary Yellen. The topic of Powell’s testimony is the CARE Act for Covid relief, but investors will be looking for any comments related to higher bond yields or inflation. Any remarks in this regard from Powell or Yellen could shake up the US dollar. US 10-year yields posted their sharpest weekly rise since February, with the 10-year hitting 1.72% on Friday, before retreating today to 1.67%. The US bond market holds auctions this week of bonds in the amount of 100 billion dollars, so we could see some movement in US yields this week.
- There is resistance at 1.3974, protecting the symbolic 1.40 level. Above, there is resistance at 1.4082
- We find support at 1.3782. This is followed by support at 1.3699
For a look at all of today’s economic events, check out our economic calendar. www.marketpulse.com/economic-events/
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