The Pound Sterling Gained Ground Against the US Dollar
London: 11 December 2023 (TraderMade): The British pound strengthened against the US dollar on Monday, propelled by anticipation of a data-laden week culminating in the Bank of England's (BoE) final policy meeting of the year.
As of 01:25 PM GMT, the GBPUSD pair rose by 0.21% to 1.25751.
Market participants eye on the BoE's Thursday meeting, expecting the BoE to maintain the current Bank Rate of 5.25%, a 15-year high. However, recent focus has shifted to the timing of future rate cuts. The expectations lean towards a slower pace compared to the US Federal Reserve.
Experts see the Monday rise in GBP as driven by the potential widening of the UK-US interest rate gap and BoE's anticipated hawkish tone at its meeting. Data releases this week are expected to provide valuable insights into the UK economy's state. Key figures include labor market data on Tuesday and GDP data on Wednesday.
Experts expect UK data to support the BoE maintaining high-interest rates, with GDP holding steady and wage pressures persisting.
The focus may likely remain on dollar dynamics due to the release of US CPI data on Tuesday and updated economic projections from the Federal Reserve on Wednesday.
Meanwhile, the manufacturing trade body Make UK reported signs of recovery in the UK's struggling factories, fueled by restocking activities and a rise in export orders. Despite the challenging economic climate, the recent growth could offer positive momentum for the sector in 2024.
