The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
Sterling slips before jobs data
Sterling is trading sideways against the dollar and the market is expecting low trading volumes and little volatility on the run up the announcement. GBP/USD has been in a downward trend over the past week, and today’s non-farm payrolls announcement will be a turning point as to whether a correction will get under way or whether there will be a continuation of the trend. The recent move we have seen in GBP/USD has been mostly dollar driven, but it is worth noting that the UK services report missed estimates – the services sector accounts for nearly 80% of the British economy.
The UK will release the consumer inflation expectations at 9.30am (London time). The previous reading came in at 2.5%, and should today’s announcement show a dip in CPI expectations it will put pressure on GBP/USD.
The currency pair is encountering resistance at the 50-day moving average at $1.5240, and should this level be held the support at $1.52 will be brought into play. If that mark is punctured $1.51 will become the target. A move above the 50-DMA will bring $1.5260 into sight, and then traders will look to $1.53.