The British Pound rallied above the 1.3500 level against the US Dollar on Friday, recovering from earlier losses as the greenback weakened across the board. The move comes as recent US economic data showed softer-than-expected inflation readings and mounting evidence of labor market weakness, leading traders to reassess expectations for near-term Federal Reserve interest rate action.
Market participants are now pricing in reduced odds of an immediate Fed rate hike, triggering broad-based selling pressure on the Dollar. The GBP/USD pair’s climb above the psychologically significant 1.3500 threshold represents a technical shift that could attract further momentum buyers if sustained through the session.
Currency traders and forex brokers should monitor upcoming US economic releases closely, as any additional soft data could accelerate Dollar weakness and push Sterling toward higher resistance levels. The repricing of Fed expectations is driving significant volatility across Dollar pairs.
FXnCO Insight
Traders should watch for sustained breaks above 1.3500 on GBP/USD as a potential signal for long positions, with stops placed below the level to manage downside risk from any Dollar recovery.
Source: FXStreet