- GBP/USD accumulates mild losses in the Asian session.
- US Treasury yields push slightly higher lifts the demand for US dollar.
- US dollar remains on track for weekly losses despite the mixed market sentiment.
The GBP/USD pair remains subdued in the Asian session, keeping its range below 1.4200. The pair opened higher and quickly retreated toward the session’s low near 1.4169, witnessing 30-pips movement.
At the time of writing, the GBP/USD pair is trading at 1.4177, down 0.08% on the day.
The US Dollar Index (USD)trades near the YTD lows of 89.73 after witnessing heavy selling pressure on Thursday despite better than expected weekly Jobless Claims. The readings drove investors towards riskier assets for better return opportunities. The upbeat data diverged with FOMC dovish minutes providing some cushion near the lower levels.
The US Treasury yields remain pressurized near 1.63% after Fed officials reiterated that the economy is far away from full recovery and shrugged off the inflationary pressure. The affirmation read as a delayed rate hike expectations keeping the benchmark off the weekly highs.
On the other hand, improved UK economic data and gradual re-opening of the economy build up faith about the speedy recovery among investors. The UK inflation rose to 1.5% in April above the market expectations at 1.4%. The Gfk Consumer Confidence Index jumped to -9 in April from -15 in the previous month.
In the latest development, the latest survey by Reuters suggests that the Bank of England (BOE) revised its GDP forecast to 5.9% in 2021, and 5.3% in 2022 as compared to the previous 5.0% and 5.5% respectively in April’s survey. The readings added to the optimism surrounding the cable.
The Brexit saga continues to deter the performance of the cable, US President Joe Biden offered to help in resolving the Northern Ireland dispute, to which the UK has shown no interest. Additionally, Briain’s Brexit Minister restated that the EU is not fulfilling Brexit obligations on NI trade agreements this creating a tense situation over the lingering issue.
As for now, traders keep their focus on the release of UK Retail Sales data. In the US economic data, the release of Manufacturing PMI and Existing Home Sales data is eyed upon to gain some fresh trading impetus.
