Gbp/usd rises 0.37% as us and uk economic data offer mixed signals

GBPUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	0.37%	50.6 Pips
Week to-date	0.31%	42 Pips
June	0.83%	111.7 Pips

Upcoming key events (London Time)

Thu 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)
Fri 03:00 PM USD Index of Consumer Sentiment

What happened lately

In the United States, May 2025 saw diverse economic shifts. The Monthly Treasury Budget Statement plunged to a deficit of -$316 billion, a significant drop from the $258 billion surplus recorded in April. This suggests increased government spending or reduced tax revenues, potentially indicating fiscal challenges. Inflation dynamics presented mixed signals with the CPI inflation rate ticking up slightly to 2.4% from 2.3% in the previous month. The core inflation rate, excluding volatile sectors such as food and energy, remained stable at 2.8%, reflecting persistent price pressures. Notably, the month-over-month CPI inflation, excluding these sectors, decreased to 0.1% from 0.2%, suggesting a slight easing of immediate price pressures. The overall CPI inflation rate also declined to 0.1% from 0.2%, indicating a moderation in price increases.

In the UK, the economic landscape depicted a challenging labor market scenario. The Claimant Count Rate held steady at 4.5% in May 2025, yet underlying labor market indicators showed weakness. The ILO Unemployment Rate rose to 4.6% in April, up from 4.5% in March, accompanied by a slowdown in employment change, down to 89,000 from March’s 112,000. Earnings also saw a decline; average earnings including bonuses decreased to 5.3% from 5.5%, and those excluding bonuses dropped to 5.2% from 5.6%. The claimant count change increased significantly to 33,100 in May, a steep rise from April’s 5,200, emphasizing growing joblessness. Retail sales were sluggish, with BRC Like-For-Like Retail Sales dropping sharply to 0.6% in May from 6.8% in April, highlighting consumer spending concerns.

The nuanced economic data from both the US and UK bears potential implications for the GBPUSD currency pair. The British pound edged up 0.37% to 1.35476 against the US dollar, illustrating mild bullish sentiment amidst these economic conditions. The UK’s weaker labor market and consumer activity could undermine the pound’s strength, potentially balancing out the negative sentiment from the US fiscal data. Market participants may look towards upcoming key US events, such as the USD PPI excluding food and energy and the Index of Consumer Sentiment, to gain further directional cues. These high-impact events could either exacerbate or mitigate existing trends, influencing GBPUSD movements accordingly.

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What can we expect from GBPUSD today?

GBPUSD on Wednesday rose 0.37% to 1.35476. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for GBPUSD looks mixed as the pair is likely to consolidate above 1.34853 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.35672 or trades above daily pivot 1.35262. Break above could target R1 at 1.35886. While to the downside, we are looking at 1.34853 (S1) and daily low of 1.34639 as support levels. GBPUSD need to break on either side to indicate a short-term bias. A break above 1.35672 may suggest continuation after recent positive movement.

For the week to-date, take note that GBPUSD is mixed as compared to the prior week.

Key levels to watch out:

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