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GBP/USD Puts in Week of Strong Gains

Friday’s high: $1.3216

Friday’s low: $1.3128

GBP/USD Slips Slightly from Monthly High

Last week saw one of the best weekly GBP/USD gains in months, as the US Dollar broadly weakened.

On Friday, Sterling advanced due to the latest UK manufacturing production results, which beat expectations in both monthly and yearly prints. NIESR’s UK growth projection also impressed traders.

However, GBP/USD slipped slightly from its best levels on Friday evening as July’s US wholesale inventories results beat expectations and came in at 0.6%. Overall though, this report did little to improve Fed rate hike bets, leaving markets still generally dovish on the US Dollar.

USD Outlook: Inflation in Focus Next Week

Next week will be a big one for central bank speculation, as August inflation results come in for Britain and the US.

The Bank of England (BoE) will also be holding its September policy decision.

If UK inflation beats expectations, Sterling could advance as investors await the BoE – but unless the BoE also takes a hawkish stance the Pound may not sustain its gains.

US inflation data will come in on Thursday. Some Fed officials still believe inflation will rebound and could still support a third 2017 Fed rate hike bet. As a result, the upcoming US inflation report could have a notable impact on Fed bets and the US Dollar.

Key Events

12th September

09:30 UK Inflation Rate

13th September

09:30 UK Employment Report

14th September

09:30 UK Retail Sales

12:00 Bank of England Policy Decision

13:30 US Inflation Rate

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To keep up to date with the US Dollar, visit the USD blog in our Currency News section.

Arron Morris

Senior Currency Broker
T: 01442 892 065

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