The GBP/USD currency pair continued its upward trajectory past the 1.3400 level through the Asian trading hours on Wednesday. As of 24 September the pair traded with slight gains, around 1.3405. First, we’re seeing an upward movement on the heels of tame growth in economic indicators here in the United States. This continued data has pulled the US Dollar down substantially, including the S and P index exchange rate.
According to market analysts, the recent GBP/USD performance largely depends on upcoming key economic data releases from the US. In short, they’re watching these changes like hawks. Investors are particularly attentive to three significant reports scheduled for Wednesday: the ADP Employment Change, the Personal Consumption Expenditures (PCE) Price Index, and the Flash Q1 Gross Domestic Product (GDP) report. For each of these indicators, we hope to provide some further context and details about what they’re telling us about the overall health of the US economy.
The ADP Employment Change report will always be the clearest preview of private sector employment growth. This report frequently foreshadows the future release of official labor statistics. Meanwhile, the PCE Price Index measures consumer price changes and is a critical gauge for inflation levels in the economy. Lastly, the Flash Q1 GDP report will offer an early estimate of economic growth, shaping market perceptions regarding the Federal Reserve’s monetary policy decisions.
GBP/USD traders are particularly focused on the next critical economic indicators. The combination of these indicators has the potential of being a game changer for market sentiment.
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GBP/USD is still patting itself on the back. Traders are still largely cautious but hopeful that the pair can make a bigger move yet as they look ahead to important US data releases. The dollar’s fluctuations in reaction to these reports could either bolster or hinder GBP’s current positioning.