GBP/USD Outlook: Pound to Dollar Rate Strengthens amid Return to Upbeat Trade

September 27, 2024 - Written by John Cameron

STORY LINK GBP/USD Outlook: Pound to Dollar Rate Strengthens amid Return to Upbeat Trade

The Pound US Dollar exchange climbed on Thursday as a return to cheery trade bolstered the currency pairing.

At the time of writing, GBP/USD was trading at approximately $1.3351 down roughly 0.3% from the start of Thursday’s session.

The US Dollar (USD) struggled to catch bids against most of its peers on Thursday despite the release of stronger-than-expected domestic data.

August's durable goods orders came in flat at 0%, outperforming the anticipated -2.6% decline while the final GDP reading for the second quarter confirmed the US economy grew by 3%, in line with forecasts.

Additionally, initial jobless claims for the week ending September 21 were lower than expected, coming in at 218,000 rather than an expected 225,000, confirming fewer unemployment filings.

However, the wave of positive data failed to boost the 'Greenback,' as optimistic market sentiment reduced demand for safe-haven currencies.

The Pound (GBP) made modest gains against most of its peers on Thursday as market sentiment improved, benefiting the risk-sensitive currency.

However, Sterling's advance was held back by the release of the latest UK consumer sentiment index from the British Retail Consortium (BRC).

The index dropped sharply from -8 to -21, largely due to growing concerns over the forthcoming October Budget, which dampened the Pound's momentum.

Looking ahead to Friday, several US data releases are likely to be the main drivers of movement in the Pound US Dollar exchange rate.

The US will release its latest Core PCE price index which stands as the Federal Reserve’s preferred inflation measure.

Forecasts suggest a rise from 2.6% to 2.7% for last month’s data, which could boost the USD by signalling ongoing inflationary pressure in the US.

In contrast, the UK’s economic calendar is fairly light on Friday, leaving the Pound without a clear directional influence as the weekend approaches.

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TAGS: Pound Dollar Forecasts