GBP/USD holds to gains despite DXY’s recovery
- Pound outperforms on Thursday, rises versus USD and EUR.
- GBP/USD gains for the third day in a row, turns positive for the week.
The GBP/USD pair rose on Thursday reaching the highest level in six days at 1.3081 during the American session. Then it stabilized around 1.3065/70, posting a daily gain of 30 pips.
Cable moved all day with a bullish bias and rose even on US hours despite the strength of the US dollar. The DXY climbed today to 97.36, recovering from weekly lows on the back of US data and higher Treasury yields. Retail sales excluding autos rose 0.7% in December, the largest gain in five months while the Philly Fed jump to 17 from 2.4.
“With UK activity and inflation data soft, there is a strong probability the Bank of England (BoE) will cut 25bp on 30 January, yet sterling seems to have discounted that prospect and outperformed”, explained analysts at ANZ about the recent moves seen in GBP.
Ahead of the Asian session, cable remains quiet, holding to modest weekly gains. In the US Senate, the impeachment trial of President Trump began with a reading of the charges. Earlier today, the Senate passed the new U.S.-Mexico-Canada Agreement (USMCA). Chinese growth data is due on Friday while in the UK, December Retail Sales and in the US, Housing Starts and Industrial Production.