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GBP/USD – Consolidation ahead of jobs, inflation and retail data

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  • Jobs, inflation, and retail data to come from the UK
  • Markets expect 125 basis points of rate cuts
  • Consolidation in GBPUSD ahead of the data

We’ll get a lot of economic data from the UK this week which will tell us how the economy ended the year and whether markets are on the right path with respect to rate cuts in 2024.

Markets are pricing in 125 basis points of cuts this year, although even more so than with other major central banks, there appears to be quite an array of views on what they’ll actually do and how the data will perform.

This week we’ll get figures on the labor market on Tuesday, inflation on Wednesday, and consumer spending on Friday. BoE Governor will also make an appearance on Tuesday so it’ll no doubt be an interesting week for the pound sterling.

Rising triangle ahead of UK data

The pound has been consolidating against the dollar recently, forming a rising triangle in the process.

GBPUSD Daily

Source – OANDA

This could be viewed as bullish, given the rising lows and steady peaks but with so much data to come just as it would appear a breakout is near, it could easily go either way depending on how the numbers fall.

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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary.

His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News.

Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
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