GBPUSD Analysis
| Week Ending 2024-12-13 | |||
| Open | High | Low | Close |
| 1.27 | 1.28 | 1.26 | 1.26 |
| Performance | |||||
| Period | Pct | Chg | Momentum | ||
| Friday | -0.44% | -55.6 Pips |  |
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| Week 2024-12-13 | -1% | -127.6 Pips |  |
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| December | -0.59% | -75.1 Pips | |
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Upcoming key events for the new week (London Time)
Tue 07:00 AM Claimant Count Change Tue 07:00 AM Labour Force Survey Employment Change
Tue 01:30 PM Monthly Retail Trade (1-mth) Wed 07:00 AM Consumer Prices Index (CPI) (12-mth) Wed 07:00 PM Fed Interest Rate Decision (Federal Funds Rate) Wed 07:00 PM Interest Rate Projections Thu 12:00 PM Bank of England Interest Rate Decision (Bank Rate) 
Thu 01:30 PM Initial Unemployment Insurance Claims Thu 01:30 PM GDP annual rate | Q3 Fri 07:00 AM Retail Sales Volumes (1-mth) Fri 01:30 PM PCE Price Index, excluding food and energy (12-mth)
What happened over the week
In the United Kingdom, the GDP for October remained static, reporting a slight contraction of -0.1% as recorded in the September report, according to the Office for National Statistics. This stagnation indicates that the U.K. economy continues to face challenges and lacks growth momentum. Such a static GDP suggests that the economy might struggle to recover amidst ongoing economic pressures and uncertainty. The flat performance may influence how investors perceive the stability and growth potential of the U.K. economy.
The United States reported a Consumer Price Index (CPI) inflation rate increase of 0.3% in November from 0.2% in October, based on data from the Bureau of Labor Statistics. This is a minor incremental rise, signaling a slow but consistent climb in overall inflation. However, the core CPI inflation rate, which excludes volatile food and energy prices, remained unchanged at 0.3% for November. Over a 12-month period, the core CPI rate also held steady at 3.3%, indicating stable price pressures outside of food and energy sectors. The Unit Labor Costs saw a significant decrease to 0.8% in Q3 from 1.9% in Q2, reflecting a lower rise in wage expenses. Meanwhile, Nonfarm Business Labor Productivity held at 2.2% in Q3. These figures collectively reveal a relatively stable but slow-growing U.S. inflation environment, accompanied by moderated labor cost dynamics that support the current U.S. economic conditions.
For GBPUSD currency pair movements, the recent economic data and market behavior reflect complexities that traders must assess. The pound faced a 0.44% drop against the U.S. dollar to 1.26217, contributing to a 1% fall for the week ending December 13, marking a two-week low. This decline ended a short-lived rise over the previous weeks. The unchanged U.K. GDP combined with a generally stable U.S. inflation narrative may exert downward pressure on the GBP, as stronger or more stable U.S. economic indicators typically favor the USD in forex markets. Given a packed schedule of high-impact economic events, including interest rate decisions from the Bank of England and the U.S. Federal Reserve, further volatility and movements in GBPUSD are expected, making it crucial to monitor these upcoming releases for insights into potential direction shifts in this currency pair.
From X (Twitter)
GDP fell 0.1% in October 2024. Services showed no growth, while Production (-0.6%) and construction (-0.4%) both fell.
Read the full release ➡️ https://t.co/xHSGkRpgGz pic.twitter.com/IfK4LPeJrw
— Office for National Statistics (ONS) (@ONS) December 13, 2024
What can we expect from GBPUSD for the new week and what happened on Friday?
GBPUSD on Friday dropped -0.44% to 1.26. Price is below 9-Day EMA while Stochastic is falling. For the week ending 2024-12-13, the pair dropped -1% or -127.6 pips lower.
Looking ahead, GBPUSD looks mixed as the pair is likely to consolidate above week low of 1.26.
For the new week, our technical outlook looks bearish, immediate support level is at 1.26 (WS1) with break below could see further selling pressure towards 1.25 (WS2). For potential buyers, as the current momentum is bearish, we prefer to look at firm break of the week high of 1.28 as an important indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below week low of 1.26 would indicate selling pressure.
For the month of December, GBPUSD is down by -0.59% or -75.1 pips lower.
Weekly key levels to watch out:
| R3 | 1.29 |
| R2 | 1.29 |
| R1 | 1.27 |
| Weekly Pivot | 1.27 |
| S1 | 1.26 |
| S2 | 1.25 |
| S3 | 1.24 |
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Quarterly Services Survey Source: Census Bureau
Index of Production, UK: October 2024 Source: National Statistics GDP monthly estimate, UK: October 2024 Source: National Statistics UK Trade: October 2024 time series Source: National Statistics UK Trade: October 2024 Source: National Statistics Index of Production, UK: October 2024 time series Source: National Statistics Real Personal Consumption Expenditures by State and Real Personal Income by State and Metropolitan Area, 2023 Source: Bureau of Economic Analysis Business Formation Statistics Source: Census Bureau Developing nowcast methodologies for public service productivity, UK Source: National Statistics Advance Monthly Sales for Retail and Food Services Source: Census Bureau Quarterly Financial Report Source: Census Bureau Quarterly Financial Report – Retail Source: Census Bureau Monthly Wholesale Trade: Sales and Inventories Source: Census Bureau Advance Monthly Sales for Retail and Food Services Source: Census Bureau