GBP/USD: Hardships for UK PM checks seven-day winning streak ahead of US NFP
- GBP/USD bulls catch a breath around seven-month high.
- UK PM gets the beating for criticizing the Labour’s “Final Say” referendum, avoiding BBC/ITV debates.
- UK housing data, British politics could entertain markets ahead of US employment data.
GBP/USD seesaws around 1.3160 while heading into the London open on Friday. The quote surged for consecutive seven days till Thursday as it touched the May month top.
Although polls concerning the United Kingdom’s (UK) December election keeps the ruling Conservative Party on the top spot, Prime Minister (PM) Boris Johnson seems to be grilled recently. Among many reasons, the Tory leaders’ repeated declines to take part in ITV and BBC debates, coupled with his criticism of the opposition Labour Party’s “Final Say” vote, get the leads. Also, the BBC quotes the former European Union (EU) Council President Donald Tusk as saying the Brexit to be “one of the most spectacular mistakes”.
On the positive side, optimism surrounding the trade deal by the UK Chancellor Sajid Javid and ex-Brexit Party members’ push to vote for Tories seem to play their roles. Further, the US dollar’s (USD) broad weakness could also be considered as a reason for the pair’s latest strength.
Other than the downbeat data, no effective progress on the trade talks between the United States (US) and China, if we don’t believe the Trump administration, keep the cable under check.
Markets seem to play the dull tune as investors are mostly eager to read the November month employment data from the US. As a result, the US 10-year treasury yields and most of the Asian stocks stay modestly changed. Though, optimism surrounding the forecast keeps the tone mildly positive.
Ahead of the US jobs report, UK Halifax House Prices may entertain the traders. “We expect payrolls to increase by a solid 200k in November following the above-consensus 128k October print. The headline print is benefiting from a temporary boost in job gains in the goods sector, which should rebound by around 50k —a bounce-back from last month's large decline due to the GM strike. We look for the overall household survey to show the unemployment rate ticked down a tenth to 3.5% and expect wages to rise 0.3% m/m, leaving the annual rate unchanged at 3.0% y/,” says TD Securities ahead of the key US data.
Technical Analysis
Prices need to cross May month high near 1.3180 to target 1.3200 and 1.3270 numbers to the north, failing to do so highlights Wednesday’s top surrounding 1.3120 as immediate support.