![]() or any of its affiliates, subsidiaries, officers or directors. Opinions are the authors not necessarily that of OANDA Business Information & Services, Inc. It is not investment advice or a solution to buy or sell securities. The next resistance line is 1.2656Ĭontent is for general information purposes only. GBP/USD touched resistance at 1.2537 earlier.A weak release could push the US dollar lower, as there will be more pressure on the Fed to consider pausing its rate hikes at the May meeting. Headline retail sales is expected to fall by 0.4% y/y and the core rate is projected to decline by 0.3% y/y. Will the drop in inflation be accompanied by a decline in consumer spending? The markets are bracing for a soft retail sales report for March. The Producer Price Index declined to 2.7%, down sharply from 3.4%, and the core rate eased to 3.4%, down from 4.8%. Headline CPI fell to 5.9%, down from 5.0%, although the core rate nudged up to 5.6%, up from 5.5%. This week pointed to further deceleration in inflation levels in the US. Finance Minister Hunt has said he’ll cut inflation in half and a recession can be avoided, but it’s hard to share his optimism. The economic situation isn’t pretty, and the government and the BoE are under strong pressure to right the ship, and fast. An IMF forecast released this week indicated that the UK economy is projected to be the worst performer in the G20, which includes Russia. To make things even worse, the country has been hit by widespread strikes in the public sector, as workers protest the drop in real income due to soaring inflation. The combination of high inflation and rising interest rates has created a cost-of-living crisis and is weighing on businesses as well. Inflation remains in double digits, despite the Bank of England’s aggressive rate policy, which has raised the benchmark cash rate to 4.25%. Manufacturing Production was also flat and Industrial Production came in at -0.2%. GDP was flat in February on a monthly basis, down from 0.4% in January and unable to hit the estimate of 0.1%. This week’s UK releases have not been as positive as the pound’s upswing. During this time, the GBP/USD has sparkled, rallying almost 500 points. The British pound is poised to post its fifth successive winning week. ![]() US retail sales expected to decline in Marchīritish pound rallies, but UK economy struggling.UK economy grappling with high inflation, widespread strikes.British pound has jumped close to 500 points over past five weeks.
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